SUN, WIND, WOOD
It’s not just nuclear fusion that requires patience and deep pockets. “You can’t just go out and flip a switch and turn on renewables,’’ says Denver tycoon Phil Anschutz. He spent 16 years getting all the permits and easements in place to build 700 wind turbines on 100,000 acres in Wyoming, plus a high-voltage line to get the juice to Las Vegas. He needed a permit to kill some golden eagles and an easement to cross a sage grouse habitat, but has finally started construction.
Wind generation grew 12% and solar 21% worldwide last year. That’s not fast enough. But there are some promising developments, including breakthroughs in battery technology crucial to storing intermittently generated solar and wind power. Yet battery makers face global shortages of copper, nickel and lithium.
Charles Koch, whose Koch Indusclean tries is a major oil refiner, is hardly renowned as an environmentalist. But if
energy is to have a chance, pragmatism and profit motive must rule the day. Now 86, Koch, the world’s 21st-richest person, has invested $1.7 billion since early 2021 into solar and battery solutions (including battery recycling, using iron instead of cobalt and 3D battery printing) that cut the need for exotic materials and can be scaled up. It’s a shotgun approach.
When it comes to alternatives, “perfect is the enemy of the good,” says Jeffrey Ubben. In 2020, at 58, Ubben retired from ValueAct, the $12.5 billion activist hedge fund he ran for 20 years, to manage $3 billion-in-assets Inclusive Capital Partners. He sits on the board at ExxonMobil, where he’s pushing carbon sequestration initiatives, and Enviva, the world’s biggest wood pellet company. Its 10 plants in six southeastern states take trees and scraps from sustainable forestry operations and press them into 6 million tons a year of three-inch-long pellets, which are shipped to customers in the United Kingdom and Japan, who burn them in power plants instead of coal. “The Southeast is the Saudi Arabia of wood,” Ubben quips.
Enviva CEO John Keppler says he can double output by 2027. Environmentalists have qualms, but Ubben sees this as a smart short-term fix. “I don’t think wood pellets is the endgame,” he says.
There’s another natural short-term “fix”: As Russian energy disappears from the market, prices will surge until the global economy slows down enough to reduce demand. In time, the problem will be solved, but not without short-term pain and massive investment—especially in non-fossil fuels. The International Energy Agency figures the world needs to double its current spending on alternative energy and invest a total of $12 trillion by 2030 to have any chance of holding global warming to 2 degrees Celsius.
Still, there’s room for optimism, if we adopt an all-of-the-above approach to alternatives and don’t let excessive government regulation and NIMBY naysayers stand in the way, John Arnold says. Over the long term, he observes, “society has done a great job of delivering ever cheaper energy.”