Yang Would Spend $3 Trillion On Residential Solar, But The Same Money Could Decarbonize The Grid Entirely

September 6, 20195 years ago Michael Barnard 0 Comments

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Andrew Yang’s climate platform is misguided. While I like Yang’s basic income Freedom Dividend, and he has many good, if underfunded, planks in his climate platform, his biggest expenditure has a poor climate benefits-to-cost ratio and a few of his approaches to climate change are dangerously wrong.

His carbon fee and dividend is just fine. His land use and transportation budgets and targets are merely adequate. His approach to renewables is very cost-inefficient and the same money could be a lot more impactful.

About $3 trillion, or 62% of his proposed budget, is for home solar loans, which would address perhaps 2% to 5% of US energy consumption annually based on my assessment (although Mark Z. Jacobson asserts the potential is higher). That’s a bad investment, in my opinion. The same amount of money could pretty much decarbonize all primary energy use in the United States with utility-scale wind and solar, a much more effective lever, but possibly less of a vote buyer.

His focus on non-existent forms of nuclear generation — thorium and fusion — for near-term utility-scale generation are just absurdly wrong. His funding and support for carbon capture and geoengineering is at least only research and under a billion in funding, but other than that is a gift to the fossil fuel industry, not a useful proposal.

Let’s start out with the (mostly) good stuff

Like every Democratic candidate, he accepts that climate change is real, caused by us, and serious. That’s just table stakes for the nomination though. This isn’t liberal dogma, it’s reality.

“Climate change is an existential threat to humanity and our way of life. It should be a top priority of the federal government to implement policies to control anthropogenic climate change while working with other governments to implement these policies throughout the world.”

(Where I quote text, it’s from Yang’s site unless otherwise stated).

Yang2020 roadmap to net-zero emissions — Image courtesy Yang2020 campaign

Renewable Energy

Yang agrees that renewable energy is a primary path to moderating global warming. Full marks there, you would think. The platform is problematic about what that means, however.

“$200 billion invested in Grid Modernization over 15 years”

That’s about 4% of his proposed $4.9 trillion budget, which seems a bit light. This will include, presumably, not only eliminating barriers to utility-scale renewable energy, but also required transmission and potentially storage. He’s very light on details related to what he’ll actually do in the utility-scale space, and $200 billion isn’t that big a number, especially when it turns into only about $13–14 billion a year. You’ll also notice that wind, water, and solar aren’t in his roadmap graphic, but something else is. That something else will be covered in the bad ideas section.

So, what exactly is he doing for renewables?

“$3 trillion to finance loans for household investments in renewable energy over 20 years”

Hmmm… That’s just not that great an idea. Decarbonizing the grid and shifting all primary energy to electricity is the primary path forward for electricity. Home generation of electricity is not the best route forward for decarbonization in my opinion (but wait for a very significant disagreement from someone much more credible than me).

Only about 57% of single- and multi-family dwellings in the USA can have solar power per the NREL, but all but the tiniest number of buildings and industry in the USA get electricity from the grid. And most of the residential buildings in the USA that can use solar can’t put enough solar on their rooftops to cover household use over a year, just diminish it. Household solar is also higher carbon per kWh than utility-scale solar, simply because of the requirement to send people and trucks to a bunch of small locations with few economies of scale. It’s better than coal or gas generation, for sure, but the big hitter is utility-scale generation, and it’s much more cost effective, as will be shown later.

US energy flows diagram — Image courtesy US NREL

As the LBNL energy consumption flow diagram shows, under 12% of US energy consumption is by households today and that includes natural gas and oil heating. As Mark Z. Jacobson reminded me when I asked him about this, the more appropriate number to use is end energy services, but also only unrejected energy. That’s 7.72 quads of the 32.7 quads of total end energy services, or just under 24%. That’s more promising.

But only 44% of residential energy consumption is from electricity today. If home energy consumption doesn’t eliminate the 56% of energy from fossil fuels, then the maximum potential is lower. And while Yang’s carbon fee will shift some consumers, it won’t shift them as quickly as more targeted programs for modern efficient heat pumps and district heating.

However, the LBNL also shows that only about 3.41 quads (998 TWh) can be generated by residential solar, including multi-family dwellings on every dwelling which can support it. Even assuming the best case scenario, that suggests that the maximum potential for rooftop solar in terms of today’s demand is about 10% of total energy. Much of the low and median income building stock is multi-unit dwellings where there is little fiscal benefit to building owners and managers to rooftop solar, as they pass utility costs directly to tenants and unit owners. The NREL is clear that its work is an assessment of maximum potential technical resource, not the viable resource. Actual uptake is much more likely to be 20% to 50%, not 100%, so the benefit of the $3 trillion is more likely to address in the range of 2% to 5% of total US energy use.

And there are two additional factors at play. The first is energy demand is increasing, slowly, as more people climate condition their living spaces more aggressively (for the most part) and the second is that more and more of the population is shifting to denser urban living. Even more wealthy people are moving into urban, multi-family condos based on urban densification policies and lifestyle choices. The percentage of detached homes with the highest potential solar capacity will likely not increase as rapidly as multi-unit dwellings.

Yang’s single largest dollar expenditure, 62% of his $4.9 trillion budget, would only impact 2% to 5% of US energy consumption.

Commercial buildings and industrial energy use amounts to 59% of total US energy services. Where, exactly, is the money for that transformation?

That’s 62% of his proposed budget, about $150 billion a year, for something that’s not the best idea, in my opinion. When it comes to electrical generation, generate at scale and conserve locally is the right way around, and he has exactly zero dollars associated with household efficiency. He has $5 billion in materials research for new buildings, so it’s not as if there’s a lot in there targeted at retrofitting existing stock or building new stock.

What else could $3 trillion do? It could build most of the utility-scale generation capacity necessary to replace all of the primary energy use in the United States. I recently calculated for a published article what it would take if we were to solely use wind generation, which pointed out that it could be done consuming an area of land less than the size of Delaware. From the article:

“… we need enough wind generation capacity, running at a 40% capacity factor to generate 11,500 TWh over the course of a year. To get that, we need 3.3 terawatts (TW) of wind generation capacity.”

The way that the math works out, $3 trillion would enable the construction of about 3 TW of wind generation capacity, or about 6 TW of solar, most likely a roughly 50:50 split. With the hydro already in place, some pumped hydro in Appalachia and the Rockies, and more HVDC transmission, the entire US could be running on renewable energy for all energy needs. That’s right, the same $3 trillion that would address perhaps 2% to 5% of energy needs could displace all fossil fuel use in all sectors.

I’m not alone in pointing out the very large disparity between residential- and utility-scale generation, by the way. Other analyses suggest $19 per ton of CO2e for solar PV at utility-scale vs $320 per ton of CO2e for residential solar. Lazard’s LCOE analysis provides ranges of $36–$44 per MWh for utility-scale solar vs $160–$267 per MWh for rooftop. The range suggests that utility scale solar is 5 to 17 times more cost effective. $3 trillion could go a lot further than Yang’s plan would take it.

Mark Z. Jacobson, whose work I respect greatly and typically reference, disagrees with me. His assessment for 139 countries globally suggests 14.5% of the total energy demands by 2050 would be met by residential solar. His email to me when I asked him about my assessment said:

“I believe about 14.5% of all end-use energy (which is now all electricity) in the U.S. can be captured with residential rooftop PV. Another 11.8% with commercial/govt rooftop PV, for a total of around 26.3%.”

In further discussion, Jacobson indicated that his team had done a separate assessment, and that one possible explanation was that the NREL numbers excluded garages and carport roofs and finally that his number was a 2050 projection while the NREL numbers were for the current day. That would certainly easily bridge the 10% to 14.5% as a maximum technical potential variance, but it doesn’t bridge the actual percentage that would see rooftop solar or the economic viability. The 20% to 50% penetration I suggest as more reasonable turns into 3% to 7% of total energy consumption.

Personally, I see less merit in massive distributed solar compared to much more cost-effective utility-scale renewables and don’t think that the penetration will be nearly that high. However, Jacobson is a highly respected global authority in this field, so feel free to err on the side of his assessment.

If Yang were serious about renewables, that would be his plan, building massive wind and solar utility-scale farms, not faffing around with 2%–5% of US energy consumption with residential solar.

He gets marks here, but while this certainly would be better than Republican approaches, it’s pretty flawed in terms of an actual solution. So, why is 62% of his budget for home solar for such a small percentage of potential benefit? Probably because this is, once again, providing money to voters. And the voters who will be getting this money are not downtown urban elites. These are suburban and rural dwellers with detached homes, and low-rise building owners who don’t just pass electricity costs directly through to their residents. This is a massive shift of money to voters who are swing voters. Is this smart politics in terms of getting votes? Maybe. But it’s not smart policy for global warming.

Pricing Carbon

Then there’s putting a price on carbon. Yang asserts he’s against a carbon tax, but is for a carbon fee and dividend, where he points to the conservative Climate Leadership Council’s proposed approach. It’s quaint how far they are bending their brains to avoid using the word “tax” for what is exactly the same policy that Canada has implemented as a federal carbon tax with a dividend, but it might be smart politically.

Tax is a four-letter word among conservatives, and the Democratic presidential candidate has to be not only appealing to the Democratic base, but to Independents and disaffected Republicans who are voting against Trump. Independents are around 40% of the electorate at present, with about 31% Democratic and 29% Republican, per regular Gallup polling. Pew Research shows slightly fewer committed Republicans and an increase in Independents over the past few years, but with an increasing leaning toward the Democratic Party. Only about 7% of voters are actually that Independent per their research.

So, calling it a fee instead of a tax makes sense, and Yang likes dividends, with this one mirroring his basic income Freedom Dividend.

Fossil Fuel Subsidies, EPA, & Land Use

He’s also clear that he would shut down subsidies to the fossil fuel industry, which in the US amount to $4.6, $27.4, or $649 billion, depending on whether you agree with congressional research, the NRDC, or IMF numbers.

“End the current tax benefits and cuts given to fossil fuel companies which give them an unwarranted competitive advantage over alternative energy sources.”

The latter includes negative externalities, so that won’t be the one Yang is focusing on, and his carbon fee and a proposed tax on air pollution emissions that impact health covers that more than not regardless.

He’d basically turn the EPA around, reversing a bunch of the Trump administration’s attacks on it, and giving it back the mandate to regulate carbon emissions and a proactive role in global warming solutions.

His policy on better land use is not well articulated right now, showing up in one place but not in his primary solutions document, but there’s some reasonably serious money behind it.

“$285.5 billion invested in sustainable agricultural, forestry, and land methods use over 15 years”

That’s 6% of his budget, and this is an area with high payback for low investments compared to alternatives. Good marks here. Biological sequestration of carbon is the way forward, and this is a good approach.

Decarbonizing Transportation

He covers decarbonizing transportation in one document, but not in his primary solution document. So, like his land use references, it’s oddly addressed.

“2030 – Zero-emission standard for all new cars

“2040 – Net-zero for all transportation sectors

“$250 billion invested in net-zero emission ground transportation over 15 years

$80.8 billion invested in net-zero emission air transportation over 15 years”

He does have some big budget numbers behind it, so that’s positive. This implies, reasonably, that he’d unlock federal money as a first-term priority.

$331 billion makes this about 7% of his proposed $4.9 trillion plan, so this isn’t bad. This implies that his communication is the problem, more than his priorities. He’s silent on what this all entails, so there’s a lot of room for questions about what net-zero emission transportation really means. Does it include high-speed rail in the high-density coastal corridors, for example? Or is it unlikely Hyperloop schemes?

His transportation targets are reasonable, but there’s less detail on what he would do in 2021 to 2025 to make this real, compared to some other things which he is clearly making an early priority. He gets marks for this, but not full marks.

And then there’s the bad

Yang wants to diminish the impacts of global warming through two technologies which are deeply problematic.

“Invest heavily in carbon capture and geoengineering technologies designed to reverse the damage already done to the environment through a new Global Geoengineering Institute and invite international participation.”

Carbon Capture

Let’s start with carbon capture and sequestration.

There’s a 50-year track record of mechanical carbon sequestration approaches. The results are abysmal. Almost every effort of even the most marginal scale, a million tons of CO2 or more, has been done for enhanced oil recovery, for a best-case net result of the same CO2 in the atmosphere, or more likely 2–3 times the end CO2. The major exception to enhanced oil recovery is being performed because extracted natural gas in the North Sea has too high a CO2 content for sale, so it’s stripped and put back underground, but the net result is 25 times the CO2 emissions as sequestration.

Fossil fuel companies have spent several billion of capital dollars on this over the past 50 years, about 0.03% of a single year’s oil revenue globally. And they’ve spent probably just as much promoting this non-solution and on advertising about their green cred as on the actual technology.

Right now air-carbon capture, aka direct air capture, is having another moment in the sun, thanks to tens of millions being invested in Carbon Engineering, based in Squamish, but with a Harvard professor as its principal thought leader. Once again, it doesn’t scale, and the only market for Carbon Engineering’s solution is more enhanced oil recovery, regardless of what claims it makes to the contrary.

Mechanical approaches don’t scale. Chemical processes don’t scale. Direct-air capture doesn’t scale. They are many orders of magnitude off of the scale of the problem. What can scale is biological processes, and thankfully Yang is putting real money into land use, per the earlier section.

Geoengineering

And then there’s solar geoengineering.

“Invest in any idea that has the potential to reverse the damage done to the environment, for example cloud-seeding technology to increase the atmosphere’s reflectivity.”

There’s research in this space, but solar geoengineering is a bandaid, not a solution. The global ethics and scientific community has a majority opinion that solar geoengineering would likely lead to extension of fossil fuel burning, have to persist for decades or longer, would be subject to significant problems if stopped, and would likely have significant unforeseen outcomes. It’s also clear that it requires global governance, with the Oxford Principles as the most reasonable first articulation of what would be required. The fact that senior Trump administration officials have been all over solar geoengineering in the past couple of years should give pause to anyone who thinks that this might be a reasonable climate solution.

Frankly, Yang’s plans on carbon capture and geoengineering are music to the fossil fuel industry’s ears, not good ideas. It’s clear that Yang has been captured by the same crowd that captured Bill Gates, and Gates needs new climate solution advisors too. Thankfully, while he keeps talking this point up, he’s not committing a lot of money for it.

“$800 million invested in geoengineering research methods”

That money would be better put toward land use or utility-scale renewables, but it’s a rounding error in the $4.9 trillion plan.

Next-generation nuclear

And then there’s nuclear generation. Specifically fusion and thorium. Oi.

“$50 billion invested in the next generation of safe, clean nuclear power over 5 years”

Yeah, that’s near-term money. That’s priority money. That’s $10 billion a year starting immediately.

“2027 – New nuclear reactors begin to come online”

And he thinks that this will turn into new nuclear generation in 8 years, when the most realistic timeframe for fusion in actual utility-scale generation is 2050 at the earliest (and more likely much later), and there are exactly zero thorium nuclear plants operating in the world. The history of building nuclear that we know how to build today indicates a 10–15 year timeframe for the known technology.

This is a completely bogus idea with no merit. The thorium crowd likes to point at India and China, but China has committed to only build a couple of molten salt reactors with a 12 MW capacity that might use thorium at some future date, and India has even less ambitious plans.

As Jacobson said in our email conversation, while he’s more positive on the residential solar plank than I am:

“I think the more wasteful parts of his proposal are spending on thorium, nuclear fusion, and geoengineering. None of these has a chance to help solve the problem, which we need implemented now. They are all opportunity costs.”

Even if the US was to build known technology as rapidly as possible, it would be wasting money compared to putting the same amount into wind and solar generation, which are much cheaper and faster to deploy. As pointed out, $3 trillion is sufficient to build pretty much all the new renewable generation the USA needs, but he’s mostly wasting that money on home solar. This is billions more spent unintelligently.

What about the industrial sector & commercial buildings?

Global warming’s big four are electricity generation, transportation, land use, and industrial emissions (a combination mostly of fossil fuels as the primary energy source and the high carbon footprint of cement).

Yang’s plan covers electricity, transportation, and land use. But he’s doing nothing much for the industrial sector or for commercial buildings. As pointed out, that’s 35% of the USA’s energy consumption, which is a good proxy for carbon emissions. The carbon fee will prompt transformation in this space, but a lot more could be done.

The Yang2020 Climate Plan Gets a B- Grade at Best

Yang’s climate platform is flawed in several ways. The wasteful expenditure on the limited wedge of residential solar is the biggest challenge, the missing policies on industrial and commercial segments are a gap, and the tendency to focus on bad ideas such as geoengineering and next-generation nuclear drag it downward. The conservative-friendly carbon fee is a good. Eliminating subsidies for fossil fuels is a decent plank, as are the land use and transportation expenditures, but he and his team need to go back to the drawing board and get some real energy people on the team, not the ones they have.

It’s still better than anything that the Republicans will put forward in the coming years. If Yang were, miraculously, to become the Democratic candidate, there’s room to fix the problem with his climate plan. After all, he at least agrees that climate change is serious and something needs to be done about it. However, unlike his Freedom Dividend, there’s nothing in particular here that’s worth inserting into the final Democratic candidate’s platform compared to the plans of the frontrunners.

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