Millennium Project

2020 Global Energy Scenarios

Introduction

Abstract of the Scenarios

Scenario 1. Business as Usual – The Skeptic

Scenario 2. Environmental Backlash

Scenario 3. High-Tech Economy – Technology Pushes Off the Limits

Scenario 4. Political Turmoil

Comparative Analysis of the Scenarios


Introduction

The world is increasingly aware that fundamental changes will be necessary to meet the growing demand for energy. There are many possible scenarios about what may emerge in the foreseeable future. Four such scenarios were constructed by the Millennium Project and are presented here. All the research related to their construction is available in the CD included with the 2008 State of the Future.

These scenarios describe how alternative global energy conditions could emerge. Each explores plausible cause-and-effect links and illustrates key decisions, events, and consequences throughout the narratives. Much of the content of these scenarios is based on the results from a two-round Delphi. The first round collected judgments from an international panel regarding events and conditions drawn from the Project energy team’s assessment of major global energy scenarios and related research reports. This assessment and an annotated bibliography of these scenarios and reports, along with extensive endnotes for this chapter, are available in the CD included with the 2008 State of the Future section 3, “Global Scenarios.” The second round collected comments on draft scenarios constructed from the results of the first round of the Delphi.

The four axes for the scenarios were: rate of technological breakthroughs, strength of environmental movement impacts, status of economic growth, and conditions of geopolitics, including war, peace, and terrorism. Each of the axes could be high, low, or moderate (for vacillating) between now and 2020. The scenario team selected the combination of conditions of axes that might produce the most interesting and plausible scenarios for further discussion in the energy policy process.

Abstract of the Scenarios:

Scenario 1. Business as Usual – The Skeptic

This scenario assumes that the global dynamics of change continue without great surprises or much change in energy sources and consumption patterns other than those that might be expected as a result of the change dynamics and trends already in place.

Click here or on the title of the scenario to get to the full text of this scenario.

Scenario 2. Environmental Backlash

This scenario assumes that the international environmental movement becomes much more organized; some groups lobby for legal actions and new regulations and sue for action in the courts, while others become violent and attack fossil energy industries.

Click here or on the title of the scenario to get to the full text of this scenario.

Scenario 3. High-Tech Economy – Technology Pushes Off the Limits

This scenario assumes that technological innovations accelerate beyond current expectations and have impacts in the energy supply mix and consumption patterns of a magnitude similar to the Internet’s impact in the 1990s.

Click here or on the title of the scenario to get to the full text of this scenario.

Scenario 4. Political Turmoil

This scenario assumes increasing conflicts and wars, with several countries collapsing into failed states, leading to increasing migrations and political instabilities around the world.

Click here or on the title of the scenario to get to the full text of this scenario.


Scenario 1. Business as Usual—The Skeptic

Moderate growth in technological breakthroughs
Moderate environmental movement impacts
Moderate economic growth
Moderate changes in geopolitics and war/peace/ terrorism

A Caldron of Contradictions

The world of 2020 is a caldron of contradictions. It is a good time for some and a bad one for others, both promising and disappointing, full of apparent opportunities and broken promises, a world of both hope and despair. There have been only moderate technological breakthroughs in energy and other fields. Environmental impacts, while not benign, at least have not yet been catastrophic. Economic growth has been cyclical; geopolitics and terrorism have been brutal sometimes and quiet at other times. In short, with some exceptions, most past trends have continued to our time. The shifts that have occurred seem to have a random quality and are applauded or despised largely on the basis of politics, ethnicity, or nationality. One trend, however—continuing energy demand growth—has reached a crescendo, and most people in the world are now feeling its consequences.

Many historians have written about bad decisions made by governments—from the Trojan horse to the war in Vietnam. In 1984, historian Barbara Tuchman wrote The March of Folly, a book describing huge government mistakes that were often not subtle, that anyone even partially informed should have known in advance could be catastrophic. Good data were available. Alternate solutions had been proposed. But despite the high stakes, the future for those decisionmakers turned out badly. Why? Governments sometimes lie (the Gulf of Tonkin and U-2 incidents) or, to be generous, are misinformed. It is often easier for officials to go with the flow than to take risks (although some of the bad decisions were risky indeed). Political Pollyannaism, a blind faith in beneficial but low-probability outcomes rather than the more rational high-probability catastrophes, clouded decisions. Bad judgment, bad luck, holding self-interests above societal interests, amorality, timidity, and xenophobia: all trumped over rationality. These myriad forces have shaped civilization over the past 50,000 years and they shape our time as well. It is indeed business as usual.

Life Goes On

The best example of today’s folly is our energy mess. The world’s current energy situation and the bad decisions that got us here certainly qualify as a colossal, global blunder, as important as any in history. The data on energy reserves, prices, and alternatives have been largely known for decades, apparent alternative solutions were on the table, the outcome of doing little or nothing was relatively easy to forecast, and yet forces were in play that led to the failure to act decisively. Economic growth has been thwarted, poverty abounds, the bad guys call the shots, and moral foreign policy decisions have been compromised in the interest of satisfying the world’s need for oil and other energy sources.

Should the countries of the world have known that oil-consuming countries would be held hostage to the suppliers? You bet. There were many signs: the anti-US tirades of Hugo Chavez in Venezuela, bombastic governments in Iran, political instability in Nigeria, the massive and growing energy demands of China and India, and the alliances between China and suppliers such as Saudi Arabia and particularly with African countries such as Libya, Sudan, and Angola. Back in the first decade of the new century, Iranian leaders spelled it out directly and forcefully: they said they would use oil supply as a weapon to avoid sanctions designed to force them to put aside plans to develop nuclear weapons. So if the price of gasoline in the United States could be $3 per gallon without a discernable effect on economic development or consumer behavior, why not $4 or $5? According to the U.S. Energy Information Agency, today—in 2020—industrial countries import three-quarters of their oil from the Middle East Gulf region.

People began to ask, “Who is getting all of that money?” There seemed to be only a very loose connection between the price of oil and the gas price at the pump. The tax policies of the members of the European Union were taking the lion’s share of the overall economic rent from oil in Europe, larger than the share going to OPEC members. So there was a clamor to cut taxes and even a murmur that the oil taxes being paid to EU governments should instead go to poorer OPEC members.

There were some inspired moments. In 2006, the U.S. President announced an energy plan that was to have greatly lowered U.S. dependence on imported oil by 2025, just five years from now. One might have guessed that OPEC members would react badly, since their source of income and political bargaining chip was being challenged. But they needn’t have worried; it didn’t happen. Why? Because the industrial countries’ commitment to oil was too strong. Because no one was convinced, really convinced, that the world had reached “peak oil”—that point in time when petroleum reserves grow more slowly than production—and because the oil-producing countries and petroleum companies did their best to convince the world that there was more economic oil to be found. In fact, many people are still not convinced.

A public opinion survey taken the other day asked people what they thought about our present situation and outlook. The pollsters found that about 37% of those sampled said they thought they were better off today than in 2005, and almost 40% said they thought that in 2040, 20 years from now, things would be much better than today, a modest growth at best.

Another massive plan was jointly proposed in 2009 by another U.S. President and by the British, German, and Japanese Prime Ministers. They announced a program patterned after the Apollo space program but with renewable energy as the focus. (See Box 1.) It was a world plan, however, not just a plan for the United States. They called the program “The New Fire.” This time it struck a spark; it excited nations, science laboratories, industrialists—even those in the petroleum business—because many people had come to believe that the time of peak oil was probably close at hand and, more important, that the plan was serious. There were skeptics, of course. Some other factors helped convince people this time: high energy prices were going even higher, inflation was everywhere, and reserves were diminishing. It was clearly past the time for action despite limited funding, the selfish interests of certain industries, and bickering over appropriate directions within the program.

Box 1. The New Fire

A Joint Proposal of the United States, Germany, the United Kingdom, and Japan

Governments make tough decisions. Most big decisions are tough because they have uncertain outcomes, because once made they cannot be withdrawn. Uncertainty and the risk of damaging peoples’ lives keep decisionmakers awake at night wondering about the right path. For a few decisions on the horizon, however, risks seem very low and the potential benefits far outweigh the downside potential. For these decisions, we wonder, “Why not?”
Moving boldly ahead in energy research is one such decision. We have reached peak production of oil throughout the world. The attempts to meet the challenges of this event have been much too timid.
We propose a 10-year global goal of developing energy sources and systems that will reduce the world’s rate of consumption of petroleum by half without increasing pollution, a goal that is easily measurable. The program is vast and involves many industries and nations. Over its 10-year span it will devise new energy sources and infrastructures. It will create non-exportable jobs in the United States and in all countries that are part of the program. It will stimulate our economy and the economies of cooperating nations. It will improve economic development of poor countries that contribute to its goals. It will improve general technology—not only the technology of energy production and use, but technology in many fields, spinning off inventions affecting health and education. It may even help reduce the threat of terrorism as we distance ourselves from the perception that thirst for oil motivates our Middle East policies. Some people have argued that a sound energy policy is our best anti-terrorism move.
Measured in today’s dollars, the Apollo program of the 1960s cost $100 billion over 10 years. Let’s say this new energy program will also cost $100 billion. Where will the money come from? From savings in military expenditures, from the economic stimulation that the program itself will create, from matching funds that other nations will contribute to the effort, and from reduced expenditures for imported oil.
Industries around the world will benefit from the program. Expedited R&D will test new energy concepts and will design—experimentally at first and then on a large scale—the infrastructure to deliver the new forms of energy to consumers. The answers may not rest in a single epiphany or scientific discovery but in a network of reinforcing policies and practices that build robust systems capable of reducing operating uncertainties and making risks tolerable. Engineering and science education will be invigorated; new careers will be created.
What of consumers? They are ready. We already have incentives in place to encourage the use of mass transit. These will be strengthened. The program will result in improvements in the environment—cleaner air and water. The line for hybrid cars is getting longer. Many consumers look at the price of gasoline and wonder how long it will be before people everywhere are paying $5 per gallon or more at the pump. Consumers understand that to control their economic future they must move to limit their countries’ dependency on the decisions of suppliers.
What of the oil-producing countries of the Middle East? How will they react to a plan designed to decrease their sales? The rational decision for them would be to increase production and lower oil prices so that we might lose heart and go back to the oil addiction we have learned to love. Like any addict, we have to resist. Sure, we ought to fill up our reserves when the price drops, but we must remain committed to the program. Once our resolve is apparent, the best strategy of the oil producers, if they think clearly, will be to join the parade and help search for whatever comes next. Old buggy whip manufacturers went out of business when the buggy gave way to the automobile. If the whip people had entered the car business, the world, for them at least, would have been a lot different. So it is with the oil-producing countries. When the next energy wave appears on the horizon, they ought to see that it is better to ride it that to be drowned by it. In at least one plausible scenario, some of the forward-thinking oil-producing countries could help fund the global effort to find the replacement for oil.
Consider China. That nation will enjoy the falling petroleum prices that the oil-producing countries use to bait the West; this will be a windfall that furthers China’s economic development. People there may even see themselves as the emerging “last consumer” enjoying the new abundance of oil as the old consumers switch to new sources. But such opportunism carries the seeds of its own defeat as new energy systems come on-line and replace obsolete engines of consumption.
From the start, developing countries will have important research to perform, thus promoting their indigenous scientific capacity, reducing their “brain drain,” and providing new goals and incentives for education. With the fruits of this program, these countries can follow more-efficient economic development; they can jump-start toward an economy that avoids the energy pitfalls that others have discovered.
These actions will benefit the world and will hurt only those who gloat over our pain: terrorists and those who make unconscionable profits from manipulating energy prices. We are going to ask all people who support this program to practice conservation and all nations that cooperate to initiate incentive programs that will encourage the wise use of fuel.
In September 1962, President Kennedy said, “We choose to go to the moon. We choose to go to the moon in this decade and do the other things, not because they are easy, but because they are hard, because that goal will serve to organize and measure the best of our energies and skills, because that challenge is one that we are willing to accept, one we are unwilling to postpone, and one which we intend to win…” This is a great model for our time. We choose to solve the looming energy crisis not because it is easy but because to go on as we are will deny the world of our children the best the future has to offer, will keep the world on a path of depletion, a path promising riches for some and poverty for many. We choose to solve the energy question for the long term and not accept short-term patches. We choose to create our future and not simply let it happen.

The New Fire is Cooling

Nevertheless, the excitement kindled by the New Fire program did not result in a globally unified effort as had been hoped but rather piecemeal projects that added up to less than the sum of their parts. Special interests prevailed. What a wasted opportunity! There were vigorous attempts to entice all countries to subscribe to post-Kyoto agreements that would reduce greenhouse gas emissions to 1990 levels (the attempts failed), strengthened energy-efficiency standards, carbon trading plans, taxation schemes on fuel use (in place in many countries), education to raise energy awareness (sounds good, but putting into practice is difficult), readjustment of budgets for related basic scientific research (but mainly research that was scheduled anyway).

One lobby was pushing for an advanced fission nuclear reactor generation program, but the safe storage of nuclear materials still stymied the engineers. Some projects were imaginative, such as seawater agriculture along the desert coastlines of the world—planting salt-loving plants on beaches of areas like Somalia in order to make biofuels competitive, provide additional carbon sinks, and stabilize coastal erosion. Solar-derived space energy, or space solar power, was generally seen as pie in the sky and way too expensive in any event; even the experts now predict that it is still two or three decades in the future. Terrestrial solar cells have been improving in efficiency but are not yet nearly efficient or cheap enough to be in wide use.

Now the world is a decade into the New Fire program, and the countries that could have developed alternatives to oil have not. There have been only “Band-Aid” quick fixes and timid projects that pander to special interests, not the unified and massive programs that could have been justified. The technological development programs have been largely left to the free markets, and the marketplace believed that instability in energy prices should limit the levels of “prudent” investments. When people today wonder how the world has developed as it has, most often they point to many culprits: corruption, greed, irresponsible environmental extremism, short-term profit-taking and policymaking, the oil companies, life-style excesses, failure of imagination, and a lack of understanding that resources are, after all, finite.

The oil-producing countries were pleased with this situation. They controlled supply, and supply largely set prices. They were also the countries that thought they had the most to lose if technological developments produced viable alternatives to oil. Thus when it appeared that high oil prices might justify large-scale investment in alternative energy systems, the price of oil dropped, supply tended to expand, and the economic justifications of new programs evaporated. Away from the glare of media, OPEC threatened repeatedly to denominate oil price in euros, a move that could have favored Europe and proved costly to the United States. The threat was enough to cause tension among industrial countries.

India and China decided to extend their cooperative energy agreements, strengthening their earlier “Memorandum for Enhancing Cooperation in the Field of Oil and Natural Gas,” which outlined comprehensive cooperation in hydrocarbon trading and joint bidding, exploration, and production. This move sounded ominous to other countries.

There were other signals, well above the horizon, that the big energy-consuming countries were being manipulated by the producers and that there was trouble ahead. The western consuming countries, in particular, could have seen the obvious and anticipated the outcome. Consequently, they, and to a greater or lesser degree all oil consumers, are hostages now. If you asked presidents of oil-exporting countries why things have turned out as they have, they often say, “It’s your own fault. You have consumed beyond your means. We don’t make you take the oil—we sell you what you demand, and your failure to develop alternatives underscores your addiction to easy energy and your unwillingness to take the future into consideration in your policies.”

On the other hand, oil company presidents say, “We’re doing the best we can; our hands are tied. The shareholders demand a return so we must proceed as we have in the past. There has been no national strategy that would have allowed us to devote enough resources to research energy alternatives.” And some still say, “We have many decades of supply left, so let us move slowly and wisely.”

The Cost of “Addiction”

The major driver of economies around the world has been the price of oil. Today, in 2020, crude oil costs over $160 per barrel ($90 per barrel in 2005 currency), up by a factor of three in the last 20 years (see Figure 1). And the price could be over $200 per barrel by 2025.

Despite the higher oil prices, demand has just kept rising. Figure 2 shows the history and a projection of growth of energy demand in four countries or regions over the last two decades.

Increasing demand has resulted in even higher prices in a tight feedback loop. Higher prices have encouraged changes in the fuel mix and improved energy conservation and efficiency. Figure 3 shows how much global energy was required to produce $1,000 in global GDP over the last 50 years. As can be seen, the world was doing pretty well until about 2005, when efficiency was at its peak. The easy conservation targets were being harvested—automobile speed limits, incentives for smaller cars and for home insulation, taxes on sport utility vehicles, incentives to replace antiquated and inefficient energy consumption by industry, and improvements to mass transit. The curve started rising again, and now it is on a par with 1990 or so. Why should that be? It took awhile to see that improvements had ended. Now economists say that around 2010 the higher energy prices led the world to squeeze out all of the easy efficiency changes that were available––improving efficiency was too costly from then on.

Figure 1. World Oil Prices, 1988–2025 (in current $)

Source: The Millennium Project based on EIA data

Figure 2. Total Energy Demand Growth, 2000–25

Source: The Millennium Project based on data from the International Futures model of the University of Denver

Figure 3. Global Energy Efficiency

Source: The Millennium Project based on the US DOE EIA


The environmentalists had their say—at least to a small degree. They focused on legislation and international treaties while the pollution continued merrily along. Oh, a few policies were changed. Carbon trading became a game, with loads of experts and their computer models leading the way. The Corporate Average Fuel Economy standard was beefed up almost everywhere. Other policy changes included subsidizing renewable sources while taxing fossil sources, stiffer efficiency regulations, support for “tele-work,” elimination of import tariffs for ethanol and other biofuels, and charging automobile owners for access to city centers.

Further, the markets were relied on to encourage development of renewable fuels, but the effects that are now all too obvious were minor, like pouring a glass of water in the ocean. (And speaking about oceans, their levels are now clearly on the rise.)

It was also surprising to many economists that economic growth continued at first, despite high oil prices. In 2015, however, there came a time when the higher oil pices had an effect, when oil prices went above $100 per barrel and when the rate of discovery of new reserves was continuing to fall behind production rates. At that point, the old complacency was eroded. People drove less, bought less, worried more, and were cold in the winter. Water problems plagued many countries in the world. Jobs were lost and rhetoric could not hide the fact that most consuming countries were hostage. Further, inflation rose and even soared in some nations. A few new industries emerged in response to these new pressures (see Box 2), but the net effect was a gradual erosion of optimism.

Countries that had nonconventional energy raw materials, such as Canada, saw the scene as shifting in their favor. The tar sands of Alberta drew massive investments, and a major extraction, processing, and export industry grew up there. This served to expand the reserves and curb enthusiasm for the development of nonrenewable sources. Now tar sands supply almost 3% of the world’s energy. Once Canada had an exportable product, it was in their interest to maintain high prices. Similarly, Brazil, a large exporter of ethanol, also set pricing policies that gave them the highest return. What the U.S. and Europe saw as an escape from the price tyranny of OPEC proved a chimera.

The world used to think that inflation was conquered, that somehow the U.S. Federal Reserve Board and other European and Asian central banks had found the magic control knob to tailor inflation and more generally economic growth to whatever rate seemed appropriate. Now it is clear that the beast has come to bite us again. In the U.S. and the EU, in 2015, the rate topped 9% (see Figure 4 for the history and short forecast of one measure of inflation); in other countries double-digit inflation was the norm, with some countries reaching near-panic stages.

Why? The number of baby boomers born in 1960 was at a peak. In 2015 they were 55 years old, and thus the retirement rate was at its peak and demand for services—particularly health care—also peaked. Because of the numbers of people demanding care but also because health care was expensive, corporate retirement plans were failing and many plans required government rescue. It is true that the population growth rate has slowed around the world, and in 2020 the world has just shy of 7.5 billion people or so, up by about 25% since 2000. Nonetheless, government spending for weapons, wars, rebuilding countries in which they warred, and subsequent peacekeeping bled national treasuries and deficits soared. Anti-terrorism vigilance has also been very expensive. Mother Nature didn’t help either. For whatever reason—some say it’s climate change— earthquakes, hurricanes, and pandemic scares seemed all too frequent.

Box 2. We Love Our Golf Carts
A new form of transportation has emerged. Some of these cars look like small Rolls Royces, others like Ferraris. Since 2010, in many countries there has been a small industry making specialized golf carts; their users, mostly elderly people, love them. Many towns have created a special infrastructure for these vehicles, expanded bicycle paths in effect, that allow the carts to travel from the outlying residential centers to the town in safety. Certainly, they are slow, 40 mph peak, but they are very efficient since most run on batteries. A few of the carts are powered by small internal combustion engines that only sip fuel. Their use began in communities where the affluent elderly tended to concentrate. They provided reliable, short-distance transportation.
The vehicles abound in the suburbs of sufficiently affluent cities, particularly where the towns have provided special roads and paths. If we count the number of people over 65 who have incomes above $100,000 as our market segment, we find that there are 10 of these cars per 100 people, a very significant slice. They take many forms: replicas of classic cars (car companies sell intellectual property rights to the shapes), modernistic and fantastic varieties, and rolling jokes like the Titanic version complete with smoke stacks. People buy them complete or go to small businesses that customize the factory platforms.
Three significant catalysts aided the growth of this mini-industry:
1. Provision by towns and private communities of roads reserved for such vehicles. These are not roads in the ordinary sense; they bear lower weights and hence are much less expensive; they can be shared with bicycles, roller blades, and horses, and, most important, they can be beautiful, wooded, and park-like.
2. Granting of special licenses for use of these new roads. In the old days, children of elderly parents had to tell them, at some point, that they were no longer capable of driving conventional cars safely—a traumatic experience since this was a sentence for a life-style change from independent mobility to dependence. Departments of Motor Vehicles found it no easier to tell elderly applicants that they no longer had the acuity necessary to drive conventional vehicles. Solution: the new golf carts provided an alternative: encroaching decrepitude no longer means immobility. The new licenses have restrictions, of course.
3. Encouragement by organizations like AARP and insurance companies for the elderly to drive vehicles that are safer than conventional automobiles. For the insurance companies, it was a matter of economics; for organizations of elderly persons, this opened new domains of experience for their clients.
Not only did the market grow, but unexpected by-products appeared. To list a few: there are golf cart races at Daytona and Indianapolis, the kids hop them up, there are gymkhanas and rallies, and there are distance and duration competitions. Teen-agers are advocating a new pre-licensing class for their age group. This new vehicle category did not cannibalize the conventional car market; it layered on a new dimension.

The Cascade of Consequences

The price of energy was the primary reason for the growth of inflation, however, and it turned out that the oil-producing countries had more control than the regulatory agencies. Trade deficits grew in energy-importing nations. Since the price of imported oil was so high, many of the importers had to increase their money supply to help reduce their trade deficits. Many countries called their international loans. Action: print more money. Result: inflation. Many economists think it is lucky that inflation stayed as low as it did. The only reason inflation began to ease in many countries after 2015 was recession in most places and a depression in some. When that happened, some saw a “great depression” looming. But the dip lasted only five years and now recovery is becoming apparent, although it’s a different and difficult world.

The economic crisis was a special problem for Middle Eastern countries that had a rich elite and an ever-growing multitude of young, poorly educated, unemployed youths. As happened in France in 2006, demonstrations by young people full of anger, losing hope for a better future, called their governments to task; people everywhere protested their poverty. When global inflation spread to these countries, the political pressures became intense and resulted in challenges to elitist regimes in Egypt, Saudi Arabia, the Arab Emirates, and elsewhere. Where these challenges were successful in Middle Eastern countries, political control and control of oil supply shifted to fundamentalist governments. Like dominos, these changes led to bidding wars and confrontations between the West and China and India for oil supplies. Some people suspect that the fundamentalist regimes designed their oil policies to pit China and India against the West. But more on that in another essay.

Figure 4. U.S. Inflation Trends, 1960–2025

Source: S. Easson and T. Gordon, A Study of the Use of the Delphi Method, A Futures Research Technique, for Forecasting Selected U.S. Economic Variables and Determining Rationales for Judgments, Prepared for the Society of Actuaries, October 2005


Chinese Cars for the World

China’s demand for oil now, in 2020, exceeds that of the U.S. and the EU; in fact, it accounts for 30% of the growth in oil demand since 2000. China, by 2010, was the world’s largest consumer of many commodities: aluminum, copper, steel, and coal. What fueled this huge increase in oil demand? High economic growth was responsible, to be sure, but more important the primary mode of Chinese private transportation changed from bicycle to automobile. In 2000, the country had only 10 motor vehicles per 1,000 people, compared with 765 in the U.S. By 2020, that figure was 200 motor vehicles per 1,000 people in China, and most industry analysts forecast more growth to come.

As important as the Chinese domestic market was to the country, it was their export market that changed the face of the world and the world’s energy situation. China’s economic policies favored the development of the automobile industry. In 2000, Chinese automobile manufacturers produced more than 2 million vehicles; sales volume was up by 14%; automobile manufacturing was the path to the future. Feng Fei, vice minister of the State Council of China’s R&D Center, said in 2004, “The auto manufacturing industry has stepped onto a stage for large-scale production in China.” He predicted that China would be able to export sedan-chair cars on a great scale, and they did. (See Box 3.)

By now, in 2020, the Chinese sedan car design has evolved to a true all-electric vehicle. This year, China produced over half a million units; all other countries together produced another half-million. Electric cars made great sense in China; the technology was well understood and it was seen as a way that the country’s coal could be used (via generation of baseload electricity) to provide mobility and minimize pollution in urban centers. Most large cities banned entry of vehicles that burned gasoline or diesel fuels, so the move to electric propulsion was welcomed around the world. Many countries gave tax credits to purchasers of electric vehicles. The export market was waiting for the Chinese electric cars. Consequence: despite their attempts to survive by introducing new engines (for example, Stirling engines), old-line automobile companies failed, and oil companies consolidated.

Box 3. Sedan Chairs
Sedan chairs? Ah, there’s the clue.
When China entered the World Trade Organization, automobile manufacturers around the world saw this country as a great potential market for their products, and the export of cars to China became an important marketing target in Detroit, Stuttgart, and Tokyo. It was easy to multiply the projected population of China by the number of cars per person in the U.S., Germany, or Japan to get staggering figures about the potential of the Chinese automobile market. Furthermore, with China in the WTO, import tariffs would be limited.
However, there were impediments to this dream of Cadillacs in Beijing and BMWs in Shanghai. China was not about to give the market away to foreign companies, particularly in view of the petroleum consumption, overcrowding, and pollution it implied. Thus a development plan was initiated in Beijing to nurture the young domestic automobile industry, to encourage the design of a car compatible with Chinese needs, and to find ways in the interim to use imported vehicles to fill the gap between domestic production and demand.
The foreign car manufacturers saw the blip in demand as a hopeful sign and built overcapacity based on this expectation. Bad decision.
The Chinese car evolved from the boxy, three-wheeled motorcycle sedan car that became popular in Chinese urban centers early in the century. The new sedan car that was designed for domestic use was very light, had a small engine capable of running on pure ethanol or gasoline, was available in three- or four-wheel configurations, and—best of all—had a sleek plastic body, mostly recyclable. An early gimmick was that if the car failed it could be turned in for a new one. The pricing was initially subsidized by the government; but when sufficient volume built up, the cars were profitable at half the price of the imports. International competition withered.
Then the exports began in earnest. There was a bit of customization for foreign markets, primarily added electronic systems. Imagine a car that looked great, carried four people, got 75 mpg at a peak speed of 75 mph (this became known as the 75 squared spec), with a range of 400 miles at a price of under $10,000. In the electric version, the mpg was basically infinite. The world’s auto manufacturers continued to build their products, but fewer than they had hoped, focused on niches and image, and became suppliers of parts and aftermarket add-on to the Chinese cars. Many failed, many merged.

The World Energy Supply

The net consequences of these developments on world energy supply are summarized in the Table 1. As might have been guessed, the demand for oil and conventional coal have increased considerably since 2006, but demand for natural gas has grown by almost 50%. Despite the scientific interest in fusion energy, including important research by the Chinese, the process is still seen to be a very long way off.

Overall, global energy use has grown by over 36% since 2005. Conventional oil supply has grown at a much slower pace (17%), so it is losing its market share. However, note that oil from tar sands has grown rapidly and now supplies over 2% of the world’s total.

Conventional coal has also grown more slowly than the total (15%) and hence has lost share, although the new coal processes such as liquefaction and gasification have grown rapidly and now make up about 3% of the total. Not only has natural gas grown greatly, but it is now contributing an amount of energy that is of the same magnitude as coal and oil. Nuclear (fission) and hydro continue to supply significant amounts, about 5% of the total. All of the other so-called promising renewables are still waiting in the wings. One spot that is a bit brighter than the rest is terrestrial solar energy. Although space solar projects have foundered, terrestrial solar energy has grown. The questions about space solar resulted from high anticipated costs, uncertainty about the technology, and the unproven net energy balance of the scheme. (There is some suspicion that pro-oil interests have engaged in anti-space power lobbying.) Yet terrestrial solar (photovoltaics, solar thermal, and solar power towers) is now approaching a healthy 1% of the world’s energy supply.

Ethanol is a particularly important fuel and fuel additive. Of course, it comes from many sources: waste, cellulose, corn, sugarcane, palm oil, sweet sorghum, saw grass, and so on, so agricultural polices throughout the world were adjusted to encourage this renewable supply. Genetic research into new, higher-alcohol-producing varieties was encouraged. Engine designs were altered to accept fuel blends in which ethanol (and other alcohols) represented a higher and higher percentage. Brazil, which was a prodigious producer of sugarcane-based ethanol, became a major exporter of the fuel, and by 2010 half of its exports were going to Japan. The parade of ethanol exporters grew and, to mention a few, included Argentina, Australia, Central and South American countries (such as El Salvador), Malaysia, Mexico, South Africa, and Poland. As early as 2004, India established programs to encourage ethanol production.

The EU, with its huge agricultural production of sugar and grain, converted a major portion of its surplus into fuels (Germany and France led in the production of biofuels). And to boost the possibility of a European biofuels industry, the EU introduced protective tariffs on imported ethanol. The U.S. and other countries cried “protectionism” and created ethanol reserves. Anti-genetic modification attitudes in Europe were deeply ingrained and continued, and production of the crops needed for this embryonic industry were lower than they might have been. The European countries opposing genetic modification included Austria, France, Portugal, Greece, Denmark, and Luxembourg. With the emphasis on ethanol, world food supply became imbalanced and hunger increased. There were brave experiments that attempted to use marginal lands and brackish water for the production of alcohol crops, but these added only marginally to the acreage. It seemed that the world could not have both adequate food and expanded production of alcohol grains. It was indeed business as usual.

Table 1. Evolution of the World Energy Mix (Business as Usual Scenario)

Source: The Millennium Project based on 2006 energy survey


Opportunistic Terrorism

The intersection of these developments with global terrorism deserves special attention. Terrorism is still a major concern. There have already been small attacks during the past two decades, and many people expect that they will grow in scale in the next 20 years, able to disrupt supplies by 5–10% for at least a month. Some analysts think the anti-oil mission of the terrorists is to cause democratic governments and secular economies to fail so that fundamentalist governments can take their place in some oil-producing nations. There may be other reasons as well, such as alienating the moderates from their ineffectual governments, maintaining wealth concentrations in oil-rich countries, and slowing the development of advanced technologies, which they see as irreligious. Some people have even suggested that, through terrorism, the terrorists themselves believe they can become rich by taking over oil resources.

At very least, some analysts think that terrorists want to see a rise in the price of oil (and attacks on supply result in price increases) to enrich Arab countries. They want to reduce the Western presence in “their” countries. They want to undermine democratic governments by pushing them to adopt strict security provisions that move these countries toward police states and truncate what the terrorists consider to be immoral freedoms. Some see terrorism devolving to a protection racket, functionally indistinguishable from organized crime. Clearly, they want withdrawal of Western troops and corporations from Moslem countries to “purify” the Islamic caliphate.

Killing of people over the last 20 years was a strategy designed to illustrate the weakness and fragility of nonfundamentalist countries. With the obvious need for oil, it was apparent that there were other ways to provoke failure and to illustrate, and perhaps intensify, the inherent weakness and fragility of the countries they perceived as decadent. Initially the approach was to attack the oil fields and the institutions and infrastructure of the oil industry. Military presence in oil fields was increased in response to this threat. Ports and pipelines were vulnerable, so new ports and pipelines were built offering parallel paths to the markets. By and large, though, security was spotty and only partially successful.

Terrorists hatched a plan. In great secrecy, in a dozen places, biochemists loyal to their cause were directed to produce self-replicating microorganisms designed to contaminate oil with contagious human pathogens. Bugging the oil, they called it.

This was not the only oil/biotech program under way. Many biomethane projects were being pursued to find more cost-effective ways of converting agricultural crops, and cellulose in general, to fuel. A dozen legitimate laboratories have been attempting to develop strains of microbes that, in one application, could be injected into depleted wells to digest heavy oil residuals and produce less viscous crude that could be more easily pumped to the surface. In another application, anaerobic microorganisms were designed to convert the residual oil to methane.

The contraband organisms looked much like the legitimate ones, and they were injected into half a dozen wells in the Middle East. When mini-epidemics developed among oil field workers, there were celebrations among the minions of the radical terrorists. They announced their success, and in so doing created a wave of fear about the extraction, processing, and use of oil. This was better and more effective than exploding a bomb under a pipeline. At a considerable cost, the oil companies had to bio-isolate their workers and prove to various environmental protection agencies around the world that refining oil also pasteurized it.

Finally

So, yes, it’s easy to be a skeptic. We’ve heard it all before. What people miss most about the old days is vacations in distant places, freedom to drive what they wanted and where they wanted, having a government they could believe in, that tells the truth—if indeed anyone knows what truth is any more—and stability. Today there is too much pessimistic thinking about energy. Reserves have grown in the past when depletion was forecast, and now many people in the industry say it will happen again. As for developing new energy systems, with effort and fortitude the world powers can solve the problem; they can do anything they want to do. But the World Soccer Games are on TV now, so let’s worry about all this tomorrow.



Scenario 2. Environmental Backlash

Moderate growth in technological breakthroughs
High environmental movement impacts
Moderate economic growth
Moderate changes in geopolitics and war/peace/terrorism

The catastrophic nuclear accident in 2008 that polluted the Indian Ocean with radioactive waste galvanized the brewing environmental movement with a new dynamic force around the world. Pro-environment politicians were elected, and the G8 hammered out an agreement to create and implement the Global-Local Energy-Environment Marshall Plan (GLEEM Plan) with an Apollo-like mandate to fix the energy situation and reduce climate change.

Figure 5. Nuclear Power Reactors in India

Source: International Nuclear Safety Center

The environmental backlash had been gathering momentum for years—both from nature and from environmentalists. From the 1970s onward, forecasts of climate change and its impacts have proved to understate what actually occurred. In the last 10 years, major areas of tundra have melted, releasing huge amounts of methane, a gas 22 times more dangerous for the climate than CO2. Nature’s backlash was felt most directly via increasing droughts, flooding, hurricanes, tornadoes, new diseases, fires, sandstorms, falling crop yields, and social unrest among millions of environmental refugees from dying rivers and lakes. During the past 10 years East Africa experienced massive famine, killing 20 million. Many fishing industries around the world are gone. The water tables have fallen dramatically in India and China over the last 20 years, leaving dry wells for hundreds of miles in many locations, forcing millions to flee to already congested cities, where tensions explode into riots.

Increasing demand for meat accelerated the industrialization of livestock production, with its massive concentrations of animals and their wastes, which led to the Pig Flu pandemic of 2010 that killed more than 25 million people. Less dramatic but also quite devastating is the slow-motion march of desertification in Asia, Africa, North and South America, and the Middle East. Hundreds of species of marine life have been exterminated due to increased acidification of the oceans from CO2 deposition. The changing climate increased drought and fires in some areas and floods in others. It altered insect migrations, which carried mutated viruses that caused new epidemics; it shifted crop yields to more northern and southern latitudes, causing parts of Siberia and Canada to become a viable breadbasket; and it meant glaciers in high mountains disappeared, leading to water problems in major mountain-valley regions around the world.

The nuclear catastrophe caused massive fisheries collapses, first in the Indian Ocean as a result of the accident, causing food shortages in much of south Asia, then subsequently in other fisheries, as pressures to catch fish were redirected. Just as in the Chernobyl nuclear accident, the human mortality will not be fully known for years, but it is expected to be worse than in Chernobyl. Many people fled the area and settled elsewhere with little systematic medical follow-up. There were also some airborne contaminations that caused crop losses and failure in the region. Radiation caused enough loss of plankton in the Indian Ocean that the natural CO2 absorption capacity was reduced, contributing to record annual increases in atmospheric GHG concentrations. Increased acid rain in the industrial areas further reduced the ability of green cover to absorb CO2 and increased soil erosion.

The backlash from nature that makes scientists most worried is the beginning submergence of the Gulf Stream in the North Atlantic by freshwater runoff from the Greenland icecap. This will reduce the ability of warm ocean currents to flow along Europe’s coasts, giving it the same weather as Canada before its recent climate changes. If Europe cools, its ability to feed itself will also be reduced, increasing food costs around the word.

The environmentalists’ backlash cut a broad swath across the array of industrial powers. There were strategic lawsuits, high-profile public confrontations, protocols to environmental treaties that used biosensors and satellite data for better detection of environmental crimes, tougher national regulations (mostly in Europe), inflammatory Internet blogs, and violent attacks on the key offices of fossil fuel industries. Although the horrific 2008 disaster caused the environmental movement and public attention to cross a fundamental threshold, knowing that environmental viability for life support was no longer assured, the world’s dependence on fossil fuels continued.

Increasing damage from hurricanes, like those that hit New Orleans in 2005 and Houston in 2007, and drying water sources in India and China added to the intensity of the environmentalists’ outrage at the inaction on climate change. Prior to the Indian Ocean nuclear catastrophe, political and corporate leaders gave emotional speeches full of beautiful rhetoric about sustainable development but they acted with little urgency; they congratulated themselves over agreements that were trivial compared with the enormity of the situation and the task to be achieved. This caused a gathering potential firestorm of resentment and anger in the environmental movement that just needed a spark to spread worldwide.

It is ironic that the spark was a nuclear accident, rather than emerging climate changes, that led to environmentalists’ greater focus against the global fossil fuel industries. Since the growth in nuclear energy was essentially stopped by the environmental movement by the mid-1970s, and the 2008 catastrophe killed all future plans to build new nuclear power plants, the fossil fuel industry became the next logical target. Their mission was to change the world’s energy sources to non-nuclear, non-fossil fuels for baseload electricity and transportation power. Self-organized groups set out to destroy any obstacle blocking this change. Although the nuclear disaster got it going, it was the continuing evidence of climate change that sustained the movement. Today the Gulf Stream has shifted enough that it brings less heat north, making Europe colder. It was difficult to believe—climate change made Europe slowly warmer, and then made it cooler, bankrupting farmers, increasing heating costs, and depressing not only some economies but also the spirits of many Europeans who now expect to eventually have a climate more similar to Canada’s.

Environmentalists have endorsed nonviolent civil disobedience since early-twentieth-century protests at the Hoover Dam in the United States, but even before the Indian Ocean catastrophe increasing numbers had begun to talk about more serious sabotage of the fossil fuel industry because people were not taking global warming seriously enough. Even during the 1990s there were attacks on oil company facilities and kidnappings of employees that had been largely kept out of the press, for fear of copycat attacks. These and subsequent scattered attacks on oil companies, automobile manufacturers, and large car dealerships were unable to make much impact on fossil fuel consumption. The potential targets were too numerous and diverse. Should the saboteurs hit drillers, refineries, pipelines, tankers, storage tanks, truckers, gas stations, car manufacturers, consumers, corporate headquarters... what?

The daily reports of new impacts from the radioactive material seeping into the Indian Ocean got so many people enraged that coordinating attacks and setting priorities for targets became irrelevant. The radiation pollution from the accident spread along the populated continent of India and neighboring areas, causing bitter political disputes between the states. Activist groups organized themselves in the U.S., Europe, Asia, and Latin America. They chose the most convenient target at hand that would make national and international news and used cell phone cameras to get dramatic images on Internet blogs that fed the media.

The new environmental movement took many forms. “Green Smart” emerged as a loose network of architects and engineers that became a force in urban planning and alternative communities around the world and made inroads in rural agriculture. “Save Gaia” radicals hit oil pipelines in the Middle East and the United States with assaults that disrupted supply by 5% for a month, and they carried out a series of cyber attacks on oil and car companies’ financial systems. In the middle were “moderate radicals” and university students who marched on the United Nations, the World Bank, parliaments, newsrooms, and corporate headquarters of leading energy companies around the world.

The Save Gaia bombers were protesting the way the world was run, the way the wealthy spent their money, and the superficial values spread by the media throughout the world that kept people pursuing irrelevant consumption while the life-support systems of nature were being destroyed. These radicals wanted to take the profit motive out of environmental destruction by targeting and causing economic damage to fossil-fuel-related businesses. They spread rumors via the Internet to affect stock prices and got employees of conscience to resign. Save Gaia had many political and economic sympathizers—those opposing globalization, free trade, cartels, imperialism, and the status quo in general—who saw the movement working to their advantage.

The backlash took many forms. In Nigeria, the environmental and economic pillage of many areas of the country by government officials and oil companies had created militant groups that grew in strength every year, kidnapping hundreds of oil company employees and both stealing from and attacking pipelines. The risks to the oil companies seemed to have no end. Finally, they took matters into their own hands. They hired militants, environmentalists, and economic development professionals to create development programs around the oil-producing areas. It was far more cost-effective to get ahead of the problem by working with the militants than to expect the government to provide a safe and reliable working environment.

On the legal front in North America, Friends of the Earth and Greenpeace achieved a precedent-setting victory in the ExxonMobil lawsuit on climate change; like the previous judgments against the tobacco industry, the ExxonMobil verdict shocked the business world. That was the key event that let the fossil fuel industry know that the rules of the game had changed forever.

ExxonMobil was convicted of causing up to 4% of the economic losses due to global warming and had to pay this amount to the Global R&D Fund established by the G8’s GLEEM Plan for alternative energy systems. It nearly bankrupted the company, but corporate leaders negotiated payment terms while integrating environmentalists into their diversification planning, and the company may well survive. Business executives in other major oil and automobile companies scrambled to create crash programs to drastically reduce their greenhouse gas emissions and fit into the plan. This paved the way for the post-Kyoto international agreement to reduce greenhouse gas emissions to 1970 levels.

Environmentalists were brought in to work with company engineers to help their businesses become greener. Some diversified into alternative energy sources. Others got into “green agribusiness,” such as seawater agriculture, synthetic photosynthesis to produce alcohol fuels, and massive tropical forest growth programs for carbon credits. Still others improved energy efficiency by retrofitting buildings for better use of sunlight for heating and for producing local electricity from nanoplastic photovoltaics.

Environmentalists became extensively involved in training and education to show how to be more energy-efficient and to change cultural attitudes. They also worked with politicians to standardize and internationalize carbon taxes, road taxes, product labeling, and other incentives and taxes to allow the market to adjust to the new conditions.

Some energy executives and environmentalists just could not work together, making their efforts a complete waste of time. Some others who were merely paying lip service to environmental concerns got caught up the excitement of re-educating their markets about clean, more-efficient and more-profitable businesses alternatives. Public education for cultural change is exciting. The burst of corporate innovations encouraged governments to create environmental taxation and emission trading systems to ensure a level playing field for business. Governments began to expedite the process of getting innovations to market and streamlined the permits within a comprehensive framework. For example, many old abandoned oil and gas fields in high wind areas were converted to wind energy sites as the result of government incentives.

Architects increasingly integrated the concepts of ecology and architecture, creating a range of “arcologies” in new construction projects that reduced heating and cooling costs. Urban systems ecology became a popular major in universities as success stories of matching industries whose waste was an input to the production requirement of others became known.

Backlash Changes Business as Usual

The environmental backlash helped make brainpower, determination, altruism, and honesty more fashionable in the energy industry than the previous mindset of corporate loyalty and short-term bottom-line thinking. Luxury businesses worked with Green Smart and other environmental groups to make top-quality products that were energy-efficient, environmentally friendly, and educationally significant. Even advertising agencies, movie producers, and rock video choreographers began to use more images and concepts that reinforced the honor of environmental stewardship.

New rules mandating stronger fuel flexibility in cars in Brazil also resulted in a large, new biofuels industry gasifying parts of the sugarcane plant previously unused (and other plants) to produce “Fischer-Tropsch” liquids, which allowed Brazil to export most of its ethanol to other nations by 2015 and to become “the new Saudi Arabia” of the Green Era.

Nevertheless, increasing oil prices, the nuclear accident, and a range of environmental backlashes created recessions and depressions around the world. Countries that decided to cut oil dependency avoided many of these economic problems. Sweden moved from being 77% dependent on oil for its energy in 1970 to 32% in 2005 and zero by 2020. Iceland hopes by 2050 to power all its cars and boats with hydrogen made from electricity drawn mostly from its geothermal resources. By 2011 Brazil powered 80% of its transport fleet with ethanol derived mainly from sugarcane and is now nearly free of oil requirements for transportation. Sugarcane is the best cultivated plant for capturing CO2.

The Eminent Scientists Group appointed by the UN Secretary General created the definitions of terms, standards, and measurements that proved necessary for effective political and economic polices. These common measures helped the establishment and implementation of environmental tax incentives, product labels (such as energy per unit), and international sanctions on violators of a series of UN treaties related to sustainable development. Improved biochemical sensors and their prevalence due in part to counterterrorism efforts have reinforced the use of these scientifically determined definitions and measures. Offenders were more easily spotted and exposed to the press, which helped generate the political will for enforcement. With these changes in policy and technology, and with an increasingly informed global market, businesses competed to show their “environmental correctness.”

The Green Smart label has become the most sought-after product endorsement due to its strict environmental standards and public relations plan that lists the best to the worst companies and countries in the world. Companies had little choice but to be rated by these standards. Highly energy-efficient companies with excellent environmental impact audits received some tax advantages and attracted more investments and international market access than those that did not get favorable reports. They were also nearly immune from health, safety, and environmental lawsuits, which attracted even more investors to buy their stocks.

Some companies that used environmentally sound production practices created their own green labels to gain a competitive advantage. “Green” producers and consumers united in political movements that changed waste-subsidizing government policies. Utilities began charging for the real costs of water, nuclear energy, and so on. Buying clubs and consumer unions encouraged people to purchase from companies that used more environmentally friendly industrial processes. The merger of many educational activities of the environmental movement and human rights groups, in collaboration with many leading multinational corporations and the global inter-religious discourses, helped to establish reasonably clean air and water and healthy soil on the political agenda as a human basic right rather than just a factor in economic cost/benefit analyses. Environmental stewardship has increasingly been added as a moral responsibility in the preaching of religions. It became almost unthinkable to propose an environmentally dangerous project.

The Wealthy Step In

The successes of George Soros in the development of the transition economies, Ted Turner in the United Nations, and Bill Gates in international health programs laid the foundation for many wealthy individuals to support the GLEEM Plan. For example, CEOs of some of the largest businesses in the world gave each other awards for who had implemented the most change in their own corporations to support the Plan. Vast PR campaigns promoted the awards and their achievements. In China, several new billionaires constructed eco-industrial parks to display green production systems and habitats that become a new alterative to Disneyland. Local charities sprang up to support small- and medium-sized companies to become more green. Larger companies got tax incentives to help smaller ones. Others that contributed to the R&D Fund called for in the Plan received tax credits from their governments. Some even painted their private planes green as a statement that their corporations supported the GLEEM Plan.

Several wealthy scientists endowed Scientists for Global Renewal to promote the best scientific conclusions on how to implement the Plan by giving its own World Energy Science Prize and opposed the activist groups who lobbied for actions with little scientific evidence. Philanthropists, celebrities, and media stars in Europe set up LeapFrog to help poorer countries skip as many of the industrial stages in the transition from subsistence farming to the knowledge economy as possible, while supporting sustainable energy technology. Major parts of the Congo basin were bought by a club of the 100 richest individuals in China to prevent what happened to Amazonia. The three richest entrepreneurs in India financially leveraged the major water projects in Asia. Some of the wealthiest people in the Middle East have turned around several major desertification areas in the world.

Smaller investors also had a way to participate financially in the environmental backlash by investing in international funds such as the Green Brick (composed of the top 10 Green Smart companies in Brazil, Russia, India, China, and Korea) and GreenMap (composed of the most promising companies, regardless of location, that are producing the technologies within the GLEEM road map).

GLEEM in the World’s Eye

The GLEEM Plan had 13 elements:

Many science and technology forums sprang up to exchange best energy-environment practices that helped keep media attention on progress and regress on these elements of the Plan. These fed the ongoing assessment of the Plan available to all on the Meta Internet Web site.

The GLEEM Plan’s R&D helped further novel technologies that served as non-fossil, non-nuclear fuels or significantly improved the efficiency of their use. The key funding categories were energy for transportation in developing countries; universal access to electricity; carbon capture, separation, storage, and reuse; and the gap between R&D and commercialization. New projects included portable sources, energy storage systems, decommissioning of nuclear power plants, and nuclear waste management. WEO also helped to implement policies—such as the elimination of energy subsidies and tax incentives—that perpetuated the status quo and stifled development of alternative sources.

Government Helps the Plan

The scientific energy measurements and standards defined by the UN Eminent Scientists Group were used to set energy pricing policies to reflect the external and environmental impacts of energy production and use. Governments, in partnership with environmental scientists and the private sector, created carbon taxes ($50 per ton) and fees for the most environmentally damaging activities. All stages of the production process were included (extraction, production, distribution, and consumption). A portion of the revenues subsidized R&D for more environmentally sound technologies and provided incentives for use of such technologies, goods, and equipment. Governments allocated some of the income to be administered internationally by the WEO long-term R&D Energy Fund.

As the cost of adding carbon capture and storage sank below the carbon trading fees, the use of CO2 sequestration accelerated around the world. Nearly all countries have consumption standards for vehicles (new and old) and some have had to ration energy and water usage. Many parts of China and India still do so today, which is the key limiting factor to their rates of economic growth. These governments supported new solar Stirling technologies that are now used to convert CO2 streams into useful liquid fuels, based on complex molecules combining nitrogen-based compounds with small amounts of carbon for stability and safety.

Carbon trading has been practiced by the majority of the top 50 emitting countries since 2010; funds from this activity are used both for local environment-energy projects and for the Global R&D fund.

With assistance from UNEP, the World Bank, and the UN regional economic commissions, most governments today have a system of national accounts that includes the economic impacts of the depletion of natural resources. The Sustainable Development Index is now used to help countries set national priorities. Most corporations of any size have used the ISO 14001 Environmental Management System to create their own EMS to continually improve their environmental profile.

These policy changes, plus the continuing technological breakthroughs and some cultural changes, have begun to have some impact on the energy-environment nexus. For example, the energy efficiency of the world economy has continued to improve. (See Figure 6.)

Figure 6. Global Energy Efficiency

Source: The Millennium Project based on IEA data and Round 1 inputs

What Happened Next?
…If It Ain’t Fit, Retrofit

Government incentives helped stimulate retrofits in such green technologies as photovoltaic roofing tiles and walls for buildings, better use of natural light for heating as well as saving electricity, more-efficient windows, and liquid crystal display lighting (solid state lighting that puts the right photon at the right place at the right time in the right color and with the desired intensity) that is 10 times more efficient than conventional lighting. Even shading over parking garages in India and China is being replaced by photovoltaic nanotech sheeting to produce extra income for parking lot owners. Cars and trucks have been retrofitted for different fuels. Rooftops from Egypt to Ecuador are getting solar panels.

However, some of the biggest retrofits that are beginning to alter the energy situation are the additions of CO2 capture and storage mechanisms in fossil fuel plants and home heating systems and improvements to temperature control in buildings. Improved insulation of existing buildings, heat-controlling paints and surfacings, air conditioning systems, and retrofits to recover and use “waste” heat are reducing energy consumption.

Improved standards for new buildings (insulation, spatial orientation, ratio of windows, efficient heating/cooling systems, and localized energy production) should also improve conditions. The use of low-cost highly efficient energy storage systems that complement solar roofs and other developments are allowing some individuals to go “off-grid.”

The development and recycling of non-fossil environmentally friendly materials for repair of roads and highways is beginning to reduce the need for asphalt. First-generation photovoltaics are being replaced with advanced nanomaterials that absorb solar energy more efficiently. Wherever feasible, nanotubes are replacing transmission wire in much of the world to conduct electricity more efficiently. This has had the same effect as producing a new source of energy without greenhouse gases or nuclear waste.

Many cars built since 2015 remove CO2 from exhaust gases by chemical absorption with solvents. Businesses that retrofit their previously built cars with this new carbon capture equipment are growing around the world—and fast!

Energy storage was dramatically improved by replacing old batteries with those using a range of nanotube applications. These new “nanobatteries” plus the three-dimensional computer chips with nanotubes have drastically cut the computer drain on the electric grids that just 15 years ago accounted for nearly 20% of electric usage in high-tech areas of the world.

The retrofit craze to get tax incentives could have been more effective if more people had conducted pre- and post-analysis on life-cycle financial and ecological cost-effects before installation. Nevertheless, the global infrastructure is being made more efficient.

Transportation

Genetically engineered synthetic life that can create hydrogen and biofuels like ethanol and methanol has been developed. This marked the historic transition from reading genetic code to writing it. Genetic codes were specifically written from data banks of genetic information that produced life forms that now create hydrogen and ethanol in the presence of sunlight in a manner similar to how plants produce oxygen. Bio-hydrogen factories are beginning to produce large enough volumes to begin to be a source of reliable fuel for transportation. Although scaling up has been difficult, this approach could one day be a major source of hydrogen.

In response to the G8’s GLEEM Plan, the major oil companies and automobile industry leaders met with environmental leaders and scientists to work out a road map to cut carbon emissions dramatically. (See Figure 7.) This included bio-hydrogen, electric cars, biofuels, and many ways to improve efficiencies. Even several years before the Plan, BP led the oil industry to the attempt to stabilize carbon dioxide in the atmosphere (back in 2003, the transport sector accounted for about 27% of U.S. GHG emissions). Some in the oil industry tried to find ways for the fossil fuel industries and consumers to reduce the amount of annual emissions of carbon from all sources to 7 billion tons by 2020, while continuing economic growth. Although 9 billion tons of carbon are now emitted, it is much better than the old forecast that there would be 12 billion tons.

Figure 7. CO2 Emissions Forecast

Source: Princeton University Press Release

Others did not take this seriously, since it would mean either building 4,900 nuclear plants around the world to replace a sufficient number of fossil-fuel-burning power plants or increasing the use of solar power by an impossibly large amount. Still, three years later, when the nuclear accident took the nuclear solution off the table, the oil industries realized that fundamental changes were necessary.

In this search for fundamental change, some transportation and energy companies followed Brazil’s leadership and led the fight for governments to pass regulations mandating flexible fuel vehicles that could use gasoline, ethanol, methanol, or mixtures of these fuels. As early as 2005, over 30% of Brazil’s gasoline demand was met by ethanol, while ethanol provided only 2% in the United States. This open standard for fuel competition provided the final incentives to make the less costly fuels more widely available.

When it was realized that less than 6% of the U.S. land mass could produce enough biomass to supply that country with its oil and natural gas needs, it became a national security issue in the U.S. Congress, which passed the biomass energy bill. Granted, there was not the accompanying reliable water necessary to produce all that biomass, but the bill spurred the R&D that helped the world make enough fundamental changes so that today 19% of all new cars use biofuels.

Biofuel production used to rely on fossil energy to convert biological sugars to transportation fuels. Even with the use of fossil energy to make the biofuels, their greenhouse gas emissions were 20–50% lower than those of petroleum fuels. Fossil fuels are now replaced with nanotech solar strips of photovoltaics layered for catching photons of the most efficient wavelengths. This, plus the use of cellulosic ethanol production techniques, now allows biofuels to be considered “greenhouse gas neutral” because the amount of CO2 plants take from the atmosphere when growing is roughly equal to what they give back when burned as fuel.

Biodiesel fuel production got an early boost when the EU mandated that 5.7% of its diesel fuel be biodiesel by 2010. Biofuel production has now replaced 10% of petroleum usage. This should increase if the terraforming of Earth’s coastlines by seawater agriculture continues. Biofuels have become a new form of wealth for previously impoverished rural areas of the world. For example, biofuels from sugarcane helped the Haitian economic recovery, and seawater agriculture helped reduce poverty along the coast of East Africa and Somalia.

Although this prevents further damage, it does not solve the problem of climate change. Additional ways had to be found to sequester the excessive global warming gases. Green Smart engineers have been testing nanotechnology applications to exhaust systems to reduce CO2 emissions. The use of nanotech on the surface of buildings to strip carbon from the air is a source for future molecular manufacturing applications. Massive tree plantings have helped, but they have only reduced the growth rate of carbon in the atmosphere without turning it around. However, the uses of advanced composites, ceramics, nanotubes, plastics, and lightweight-steel have more than doubled the efficiency of cars and trucks, which has reduced emissions proportionally.

The promise of the hydrogen economy is still just a promise—but an attractive future possibility. There are many alternative production methods and applications for hydrogen, and more than 7% of all new cars are powered by hydrogen today; nevertheless, it has not become the dominant fuel yet. Many would not buy hydrogen cars before sufficient numbers of local gas stations carried hydrogen, and few hydrogen producers and car manufacturers would take the risk of investing in distribution systems and new car designs that might not sell.

The global R&D fund in the GLEEM Plan might have more substantially funded the development of hydrogen by reducing the investment risks, but a new problem was discovered. To achieve a 50% reduction in oil used for transportation (in the United States, for example, in 20 years by using hydrogen fuel cell cars), half the new cars sold within five years would have to be running on hydrogen. Since that seemed unlikely, the hydrogen enthusiasm began to wane, not to mention that the hydrogen production might have to come from water electrolysis using electricity generated by many new nuclear power plants that the environmentalists would protest. Nevertheless, some dedicated truck fleets used a combined system of hydrogen with ammonia.

The use of metal hydrides, which store hydrogen at densities approaching liquid hydrogen, is being developed. Just a little increase in temperature releases the hydrogen. The depleted block of metal hydrides could be replaced at gas stations with a new “charge,” just like a battery. However, the process is still very new and it is not yet clear if it will succeed. In 2010, a magnesium alloy with a modified nanostructure was shown to store enough hydrogen to allow a vehicle to drive 500 kilometers, but commercialization has been slow because of very high production costs and technical problems, such as the requirement for operation at 350–400°C, still have not been economically resolved. Hydrogen suppliers have not been able to support the massive level of hydrogen distribution infrastructure needed to entice vehicle manufacturers and drivers to switch. Chemical hydrides and carbon nanostructure materials operating at lower temperatures than metal hydrides are becoming competitive in R&D trials.

Electric cars are more acceptable now that nanomaterial batteries improved the weight-storage ratio. They account for 15.4% of all cars sold in 2020. As a result, China’s long-term strategy to be the world’s leader in electric cars has paid off, and China now sells over a million cars a year. China accounts for over 50% of all new electric cars sold in the world. Granted, the majority of them are sold within the country, but their success has gone a long way toward changing world opinion about that nation’s earlier air and water polluting practices.

Hybrids are still the most popular, accounting for 31.7% of all new cars sold in 2020. Their owners can now plug them in at night to get the previously unused power in the electric grids to recharge their cars. Hence, electric plug-in hybrid cars with flexible fuels acquired the “Green Smart” image along with the Chinese electric cars. Pure electric cars were exempt from road taxes, congestion charges, and other similar state fees. Some cities—Paris, São Paulo, Tokyo, and Mexico City—have been offering free parking for electric cars for several years now, while most major cities have significant areas that are closed to private vehicle traffic. Where this is being done, the picture of urban-cloaking congestion is beginning to fade.

The use of natural gas in cars has not grown significantly because such vehicles do not address the issue of CO2 production in a manner that is significantly better than gasoline-powered cars. And, like oil, natural gas would also run out one day.

New uses of nanotubes, ceramics, and plastics reduced the weight of cars and trucks, which in turn lowered the amount of carbon emissions per mile traveled. Fuel cell cars with methanol in the tank, electric cars, and advanced Stirling engines are expected to reduce this even further.

Gasoline vehicles still account for 26.5% of all those sold around the world in 2020. Although some expected the power of OPEC to become nearly hegemonic as non-OPEC countries passed their peak oil production in 2010, Canada has become an energy powerhouse. When the United States finally realized that the Canadian oil sands could actually replace Middle Eastern oil, investments poured into western Canada, like the California gold rush. There was no political risk and no exploration costs, since Alberta was covered in the black muck. Worried by the Save Gaia attacks, the oil managers had a series of high-profile meetings with moderate environmentalists to make less damaging extraction and production plans. When the political risks subsided in Venezuela, it too received major investments into tar sands and heavy oil production around the Orinoco basin, estimated to hold 1.3 trillion barrels of oil equivalent, and became an important factor in world energy. Despite these new sources, gasoline was a dying fuel and the replacements all were seen to have finite lifetimes.

Electricity

The need for new electric production has grown dramatically due to increasing population and wealth, more electric cars, new desalination plants, and the closing of nuclear power plants (over 300 of the 443 nuclear power plants and the 25 under construction around the world in 2005 have been decommissioned by 2020). Even with the 20.7% improvement in total energy efficiency over the past 15 years, the demand cannot be fully met. Electricity is rationed in China, India, and intermittently in many other countries. There are 1.2 billion people without reliable access to electricity today.

Coal and natural gas still produce the majority of our electricity today, but the alternatives in solar, wind, and biomass are catching up. The environmental movement has affected some fossil fuel demand, but not enough to stop climate change. The greatest growth in kilowatt-hours of electricity from solar between 2010 and 2020 was due to new technology, government policies, public education, and the increasing prices of fossil fuels. Solar concentrators, mass production of thin plastic film photovoltaics with better use of nanotechnology, and solar paints lowered costs and increased efficiencies. The GLEEM plan and the WEO promoted these technologies around the globe.

With these advances in solar energy technology, governments began to make installation of solar electricity and water heating systems mandatory in all new government and some commercial buildings. They also subsidized some forms of production and gave tax incentives to buyers. Energy historians credit the “California Solar Initiative” back in 2006 as the key event in solar electric’s growth that uses $2.3 billion to accelerate solar electric production.

Farmers around the world added extra income from wind energy, which had little negative effect on agricultural output. Nearly half of Denmark’s electricity comes from wind. Offshore wind supplies a growing proportion of the rest of Europe’s electricity. Even the United States gets much of its electricity from the winds of North Dakota, Kansas, and Texas. Five years ago the construction of great ocean wind farms began in earnest; these farms are expected to account for at least 5% of world electric production by 2030. Some of this will be wirelessly transmitted via satellite to the electric grids around the world and some will produce hydrogen to be transported by sea.

The joint report of the EU-China nZEC (Near Zero Emissions Coal) project and the FutureGen project of the U.S. released in early 2019 demonstrated the engineering feasibility of coal gasification with carbon capture and storage, while producing hydrogen. Its commercial viability is yet to be determined, however, but even when it is, it will take another 20 years—until 2040, at least—to build enough new plants and retrofit existing ones to have much effect on climate change.

Also coming into question is the growing world dependence on natural gas. Although its supply would last longer than oil, it too would be gone one day and its use also emits greenhouse gases. So some asked why not use the peak oil frenzy and climate change issues to try and fix the energy problems with truly long-term solutions. As a result, further development of natural gas supplies seems short-term, and additional investment has diminished recently.

Additional Innovations

As the world has moved to ubiquitous computing and communications, the need for local and portable energy has grown dramatically. Mini methanol-fueled fuel cells now power most wearable and portable electronic and photonic appliances. There are also fashionable nano-solar accessories added to clothing and bags.

On a larger scale, and as the International Space Station neared completion, the consortium of countries that built the ISS plus China, Brazil, India, and Korea have begun to throw their weight behind space solar power. When the environmental movement finally realized that space solar power had a better chance of success than any other approach to non-fossil, non-nuclear energy to supply the world’s needs indefinitely at costs comparable to or less than today’s electricity prices, many began to support the establishment of INSOLSAT. This triggered massive international funding for space solar power. The first commercial orbital solar electric satellite and receiving antenna on Earth feeding electricity to the terrestrial grids is expected to go online by 2030. Income potential should be enormous, and private industries want to participate with government investments. An agreement was reached. Today governments account for 50% of the investments in INSOLSAT, while the oil industries have 25%, automobile industries 15%, electric utilities 5%, and private investors the last 5%.

At first, the concept of space solar electric power had no natural allies. Initially the environmental movement opposed it, as being big science, centralized technology, and environmentally dangerous. Some governments and the nuclear industries saw it as a long-term competitor for providing baseload electricity without CO2 emissions and tried to co-opt environmentalists to oppose it. Ground solar and other alternative renewable energy players saw it as competition for R&D funds and associated it with Star Wars fantasy hightech. NASA saw it as cutting into their International Space Station priorities, arguing that they could get only one major project funded at a time. So when the ISS was essentially complete in 2011, NASA began to openly support space solar electric power.

Surprising support for the idea of wireless energy transmission via satellite came from African countries of the Sahel. They had little invested in energy plants and lobbied the World Energy Organization members to invest in wireless energy transmission from their desert solar photovoltaics to satellite relay systems. Tele-robotic assembly in Earth orbit has begun; the initial test of a solar satellite in orbit is scheduled for next year. The design objective is for 90% efficiency in the wireless energy transmission from orbit to Earth. Japan has announced that if the consortium breaks down, it is prepared to continue building orbital solar power satellites on its own for commercial operations by 2040, potentially making it a major suppler for electric grids around the world.

In the meantime, coal is still the main energy source for electric power generation today, and much important work to reduce its pollution and emissions has been done and is continuing. Nevertheless, the global momentum is now irreversibly moving toward non-fossil renewable power generation sources, completing the more-efficient electric grids around the world, and getting inexpensive electricity to the billion people who still do not have access. There is also an evolving decentralized network for energy, which provides local energy for increasing numbers of people.

Work Smart––at Home––from Mumbai to Mexico City

Tele-work, work-at-home, and flexible time have finally become acceptable for many information and knowledge workers around the world, saving energy, increasing productivity, and allowing families to raise their children more easily. Although some expected problems of social disintegration, children got more attention from their parents, and previously isolated neighbors had more time together.

The initial successes of China’s sustainable communities and Finland’s Information Society Initiative for international development (which put small computer transceivers in the hands of millions of poor people around the world by 2012) helped trigger the World Bank-Linux-MIT-Google work smart economic development programs in many developing regions as well as richer megacities. This helped reduce the growing demand on urban public and private transportation systems, which are still congested—but less so—in part due to the price of oil, which still hovers around $123 per barrel in 2020.

The “return to the future” movement was in part caused by intolerable urban congestion. Green Smart engineers and energy-environment NGOs worked with private and public land developers to create high-tech environmentally sustainable communities in different settings around the world. These communities were designed for foot, bicycle, and electric vehicle transportation, reduced material consumerism, increased knowledge and esthetic consumerism, and included sylvan spaces throughout the built environment. Often these communities were built for fewer than 2,000 people.

Seawater Agriculture

Proponents of biomass fuels had difficulty proving that there was enough sustainable water to provide reliable large-scale substitution for petroleum. Then they discovered the value of coastal deserts for seawater agriculture. After a series of meetings among the Food and Agriculture Organization, the International Food Policy Research Institute, NASA, and USAID, the World Summit on the Energy-Food Nexus was held in New Delhi, India, to secure agreements to initiate very large-scale seawater agriculture. Vast desert coastlines like those of Somalia were selected to become salty Gardens of Eden by growing salt-tolerant plants on beaches for biofuels, fertilizers, and food. Large-scale saltwater agriculture also had the effect of raising water tables and absorbing CO2.

The initial successes of saltwater agriculture in the Persian-Arabian Gulf, China, and some of the coastal deserts in Baja California have begun to “reclaim” or desalinate the land, allowing for new channels to be dug that now bring additional seawater further inland to deserts. Of the 10,000 natural halophyte plants, more than 100 have been used for food or biofuel factories. With genetic modifications, many more—such as rice, tomatoes, wheat, and maize—are now grown in salty conditions. This turned out to be very important, since climate change reduced the yields of these crops in China and India.

Desert sunlight also produced electricity via nanotech plastic—highly efficient photovoltaic strips to run the biofuel plants and support the emerging coastal desert communities.

In the desert interiors like the Sahara, 10-mile-long robotically managed closed-environment agricultural tubes, interspersed with nanotech photovoltaic strips, are beginning to produce sufficient food for Africa and exports to Asia. Surplus energy from the strips is planned to be exported by microwave to Earth orbital relay satellites and on to electric grids on the ground.

Animal Protein without Growing Animals

The price of meat, eggs, and milk began to increase dramatically around 2012 as the amount of land and animal feed required to meet world demand for animal protein could not be met. Simultaneously, the increasing urban demand for meat led to dense concentrations of animal production, and mutating pathogens in their wastes were found to cause a number of new diseases among livestock and humans.

Continual global disease threats were killing consumer confidence and the livestock sector. Alternatives had to be found. Public and private investments in the Netherlands began the new meat revolution. The amount of energy, land, water, fodder, and time to produce meat via animals had been called one of the greatest environmental and energy wastes in civilization. Thanks to the Dutch initiative, stem cells are now taken from the umbilical cord blood of cows, goats, and pigs to grow muscle tissue without the need to grow the entire animal. This has substantially reduced the threats of disease and bioterrorism, as well as the requirements for land, water, and energy. Even some vegetarians see this as a moral alternative to the conventional animal factories.

Educated Consumers

The race to educate the world about being Green Smart consumers began after the World Summit on Cognitive Development in 2010. Then, only about 1.5 billion people were connected to the Internet, compared with 3.5 billion today. Back in 2010, most institutions that had even a peripheral association with education began debating the most equitable and cost-effective ways to make everyone more knowledgeable, virtuous, intelligent, and Green Smart. Educational software was beginning to be imbedded into kitchens, people movers, jewelry, and anything that could hold a computer chip and nanotech transceiver. Now the interconnection of many separate programs into several global systems of education has created a cyberspace through which most people can receive the best education at their own pace, learning style, available time, and even language. Energy and environmental considerations in decisionmaking is a new focus of education, which in turn has significant impact on the number of energy-environmentally destructive purchases.

The Meta Internet is working smoothly, providing energy-environmental data that are married with an integrated global scholarly and scientific knowledge base that is far more user-friendly today. It has increased the speed of problem-solving in all fields by providing a logically structured framework into which existing and newly acquired knowledge is placed and assimilated for examination, discussion, and extension by scientists and scholars worldwide and for a full range of educational applications and public access. Academic and business interests collaborated to create a sophisticated body of principles and techniques for knowledge visualization and the use of artificial intelligence to make it possible to navigate rapidly around the cumulative knowledge of the world. The speed of feedback from inquiry to intelligent response is so fast today that curiosity is becoming a normal mental state for most adults, which in turn exposes energy-environmentally destructive purchases to the now more educated consumer.

The promise of the information and knowledge economies to reduce the energy requirements for transportation is beginning to be felt around the world. The price of ICT interfaces has become so low by 2020 that many people in poorer regions of the world are now given free connections as part of employment benefits, rights of citizenship, insurance policies, marketing programs, and credit systems. This accelerated the diffusion of access to the Meta Internet within poorer countries. UNICEF, the World Health Organization, UNESCO, and some international development agencies also helped with distribution in poor regions. Speech recognition and synthesis, which is integrated into nearly everything, made technology transfer far more successful than originally deemed possible by the UN Development Programme’s Tele-volunteers, who did much to help the poorest regions understand and use the benefits of these new technologies. As a result, many remote villages in the poorest countries have cyberspace access for tele-education, tele-work, tele-medicine, tele-commerce, and tele-nearly-anything. This helped reduce the energy consumed per unit of GDP.

In the past we had universal declarations and local ignorance, but increasingly all these efforts have added up to a more educated public around the world.

Results by 2020 and Foundations Laid for the Future

The sixth World Summit on Sustainable Development, held in 2017, reviewed the status of the GLEEM Plan and implementation of the energy-environment Interlinkage Convention that harmonized the hundreds of environmentally related treaties. The International Court of Environmental Arbitration and Conciliation and WTO have given teeth to these agreements.

Technological breakthroughs, regulatory changes, and increased public awareness of the energy-environment linkages have changed the mix of energy usage. For example, hybrid cars now outsell gasoline-only cars, and biofuel and electric cars are catching up fast. (See Table 2.)

The big promise of nanotechnology to decrease manufacturing unit costs, requiring a smaller volume of materials and energy usage and hence lowering the environmental impact and increasing productivity, is just now on the horizon.

In the meantime, over one-third of our transportation needs are still met by petroleum. The oil producers also continue to supply the needs of aviation, plastic, and pharmaceutical industries for the foreseeable future.

Unfortunately, the dynamics set in motion over the past will continue climate change for some years to come. Although great gains have been made in both energy efficiency and the production of energy via non-greenhouse-producing systems, humans still emit about 9 billion tons of carbon per year. Granted, this is less than the forecast back in 2005, but it is still too much, since the absorption capacity of carbon by oceans and forests is only about 3 billion tons per year. If we are to avoid the point of inflection for a serious runaway greenhouse effect, we still have to continue improving. We must hope that the new polices, technologies, and cultural patterns will make the impacts less traumatic that they might have been. As a result, those who died as a result of the Indian Ocean nuclear catastrophe will not have died in vain.

Table 2. Types of Vehicles Sold in 2020

Source: Millennium Project Global Energy Delphi Round 1



Scenario 3. High-tech Economy—Technology Pushes Off the Limits

High growth in technological breakthroughs
Low environmental movement impacts
High economic growth
Few changes in geopolitics and war/peace/terrorism

In 2020, population has grown to 7.5 billion people, the global economy is approaching $80 trillion, and the wireless Internet 4.0 is now connecting almost half of humanity. Synergies among nanotechnology, biotechnology, information technology, and cognitive science (commonly known as NBIC technologies) have dramatically improved the human condition by increasing the availability of energy, food, and water and by connecting people and information anywhere, anytime. The positive effects are to increase collective intelligence and to create value and efficiency while lowering costs.

The acceleration of technological development has opened the door to continuous and rapid worldwide economic growth and has in fact allowed the world to achieve energy sustainability using many different energy sources. The NBIC technologies are proving to be the key to a very bright future, in which machines increasingly work so efficiently that the cost of goods continues to plummet and tremendous wealth is created faster and faster for everybody. All basic necessities, as well as intellectual and physical luxuries, can be accessible to even the poorest societies, thanks to a political system that has managed to keep world peace.

Space exploration, artificial intelligence, and robotics are close to a takeoff point that some experts refer to as a technological “singularity.” Meanwhile, Moore’s Law continues to hold, and computers continuously become faster and more powerful. Quantum computing, 3D circuits, and subatomic particles have given new life to Moore’s Law. It is expected that sometime soon the largest computers will have more transistors than humans have neurons in their brains. At that moment, artificial intelligence might overtake human intelligence, as some scientists suggest. That could be the beginning of an incredible scientific development, when humans can be transformed into more advanced life forms: transhumans and posthumans. In fact, already some cyborgs and clones are becoming accepted and normal in some societies, and their numbers are increasing faster than those of the so-called naturals. Biological evolution, which is slow and erratic, will be overtaken by technological evolution, which is faster and directed. Humans will never be the same, and all thanks to the great new energy mix.

The Proper Energy Mix

It all started late in the twentieth century. In 1992, an official announcement by the World Energy Council (WEC), based in London, stated clearly that the planet was not running out of energy resources. A few years later, the International Energy Agency (IEA), based in Paris, also confirmed that there was more than enough energy, including oil and gas, to last for many decades, maybe even centuries, thanks to the availability of new technologies.

Such news from two recognized institutions like the WEC and the IEA openly contradicted the pessimistic views of the previous reports of the Club of Rome, which had forecast in 1972 that the world would be running out of resources by the end of last century. The major problems with the Club of Rome’s computer models and its Limits to Growth report were that they failed to consider technological change, they overlooked new energy sources (all the way from deeper resources within Earth to new energy sources outside the planet), and they did not include resource substitution. Predictably enough, technological change, discovery of new resources, and resource substitution have been the three key energy drivers in the twenty-first century. There may be other drivers playing an important role, like the move toward virtual presence replacing real presence and the demise of irresponsible environmental fanatics, but they have had a smaller effect up to now.

After the oil shocks from the early 1970s to the late 1980s, the price of oil declined in the 1990s and even dipped below $10 per barrel in 1998. During the early 2000s, however, a long period of underinvestment in the oil industry and the long and accelerating rise of China’s economy pushed prices over $70 per barrel in 2005. That same year, Hurricane Katrina hit the Gulf of Mexico and destroyed many offshore platforms plus several petroleum installations in Louisiana and Texas. Gasoline prices rose momentarily above $3 per gallon in the U.S. and close to €2 per liter in some European countries. During the 2006 State of the Union address, The U.S. President said that his country had an “addiction to oil” and that the U.S. should reduce its dependence on oil from the Middle East by 75% by 2025.

The best way to eliminate the addiction to foreign oil was by accelerating breakthroughs in advanced energy technologies. Since 2001, the U.S. had spent nearly $10 billion to develop cleaner, cheaper, and more reliable alternative energy sources. The plan was to accelerate breakthroughs in how homes and businesses used energy and in how automobiles were powered. There were programs to improve cars, make cleaner coal-burning power plants, convert coal into a gas and store its carbon dioxide emissions underground, and develop more efficient use of wind, solar cells, ethanol, and batteries for hybrid cars, and so on. The new subsidies for coal, wind, solar, nuclear and ethanol were intended to diversify energy sources, first in the U.S. and then in the rest of the planet. Since the U.S. used roughly a quarter of all the energy produced in the world at that time, these programs ultimately had a profound impact on the future of energy around the world.

That was not the first time that a U.S. President had said, “Let’s get serious about energy.” In the 1970s, in response to the first oil shock, President Jimmy Carter proposed that the country fight a “moral war” to overcome its “oil addiction.” But conditions were different then. First, in the 1970s there were fewer environmental concerns and, second, energy technologies were not very advanced. By the 2000s, environmental groups had become more sophisticated and were a major force, but there were also many more potential technological breakthroughs that helped in tackling the energy problems of that time. Carter’s dreams of solar power were ahead of his time, while his support for Colorado oil shales was uneconomical then. The energy returned on energy invested was actually very low, which meant that it took more energy to get the oil out of the shale than was produced when burned. Other initiatives were carried out in major European countries and in Japan during the 1970s, and they substantially increased the energy efficiency in both cars and buildings, reducing oil consumption and conserving energy.

Many years later, a new U.S. President gave the 2020 State of the Union address. The first female president of the U.S. underlined the great progress made in terms of energy independence and energy diversification in the country. Although the promises of neither the hydrogen economy nor nuclear fusion have yet been fulfilled, the U.S. is almost energy-self-sufficient thanks to advances in biotechnology and nanotechnology. In fact, biofuels now account for over 20% of U.S. vehicle combustibles and long-life, automatically rechargeable nanobatteries are all the rage in electric, flexifuel, and hybrid cars. In addition, tailor-made artificial bacteria using photoelectrosynthesis are becoming a surprisingly reliable and novel source of electricity production in new power plants.

Similar advances have been pioneered in other major countries, and Europe particularly emphasized a massive conversion program for old power plants. Japan, on another front, has led the world in energy conservation practices. China, a rising economic power, is now leading the way in car technologies and carbon capture and storage in coal-based power plants and in CO2-free oxygenated coal gasification (clean coal), a source of both electricity and methanol fuel. Even poorer developing countries have become less dependent on imported energy, their industries are now less energy-intensive, and they use energy much more efficiently. On average, the world energy intensity per unit of GDP has steadily decreased, even though our energy consumption is still increasing, and major new technological changes like the extension of new uses of the electrical “vector” on everyday life are still expected. The continuous progress of energy efficiency has been due to the steady accumulation of incremental improvements in energy efficiency throughout the entire economy. It has also been driven by the steady rise in the real price of energy, which has resulted in structural changes in societies, such as denser housing, reduced travel, and manufacturing closer to the point of sale.

The Energy “Waves”

Due to the accelerated growth of many developing nations, led first by China and later by India, global economic growth has increased 4% annually on average during the first two decades of the twenty-first century. From 2000 to 2020, energy demand and supply have grown by 2% annually. This means a growth in the world’s economy of 100% and a growth in energy consumption of almost 50% during the last two decades. This indicates a very healthy expansion of the energy sector and a sustained increase in energy efficiency.

Thanks to the consistent strength and cooperation generated by continuous trade and investment flows, and barring wars and catastrophes, the world economy is also headed for more growth in the next few decades. Such growth will particularly benefit the poorer people who are still without any access to electricity, the number of which has fallen from close to 2 billion in 2000 to just over 1 billion in 2020, and electricity might actually reach everybody in the planet by 2040. World GDP growth of 4%, thanks to the continuous rise of China and India, is spreading to even poorer parts of the world. In addition, there is a continuing decline in energy intensity— that is, the amount of energy required to produce a dollar (or dinar, euro, pound, ruble, rupee, yen, or yuan) of GDP. In other words, energy efficiency is increasing and less energy is needed to produce more, particularly now that so many nations are moving from industrial to post-industrial societies. Furthermore, poorer countries have been growing proportionally faster than richer countries, and their economic stability is paving the way for continuous growth around the world. Of course, this assumes that the forces that could impede this growth are held at bay in the future as they have been in the past.

Fossil fuels still represent over 80% of total energy supplies in the world today, in 2020, but the trend toward new energy sources is clear in the future thanks to new technological developments. Coal production has basically remained stable between 2000 and 2020, which means that the share of coal has been decreasing in the last two decades, mostly due to environmental considerations in the OECD nations, even with the new zero-emissions FutureGen plants (based on the Integrated Sequestration and Hydrogen Research Initiative program). Coal gasification (without hydrogen production or sequestration) has also played a big role—especially with natural gas prices going up. China is still the largest producer and consumer of coal and has begun to export it in gaseous form, but forecasts indicate a future decline in coal-fired power plants, regardless of the existing huge coal reserves, which according to some experts could be adequate for almost two centuries.

Oil has maintained an annual growth slightly below 2%, just below the average world energy growth. In fact, there is still plenty of oil yet to be produced: the first trillion barrels of oil were produced by 2000, and the second trillion will be produced before 2030. Nonetheless, there are still close to 4 trillion additional barrels of oil in the earth, including regular conventional oil, deep-water oil, super-deep oil, enhanced oil recovery, Arctic oil, heavy oil, and oil shales. (See Figure 8.) In fact, the reserves can still continue increasing, depending on future prices and technological developments, including better recovery rates and production techniques for the 1.2 trillion barrels of oil equivalent in Canadian tar sands and the 1.3 trillion barrels of oil equivalent in Venezuelan Orinoco bitumen, for example.

Figure 8. Oil Resources According to Production Costs ($ per barrel)

Source: The Millennium Project based on IEA

Many advances in oil exploration (advanced 3-D and 4-D seismic with sophisticated interpretation), drilling (extended horizontal wells and complex well profiles), offshoring (deepwater drilling and floating production units), reservoir management (digital reservoir simulation and optimized drilling), new field developments (offshore arctic and remote offtake), chemical extraction techniques for oil shales, in-situ upgrading of extra-heavy crudes, and bacterial liquefaction of high viscosity hydrocarbons are continuously increasing the base of economically recoverable conventional and nonconventional oil. However, the price of oil—still below $100 per barrel—is high enough to motivate the search for alternative energy sources. (See Box 4.)

The worldwide best-selling book of 2019 was Life After Oil by Daniel Yergin, author of The Prize and founder of Cambridge Energy Research Associates. In his latest book, Yergin wrote about all the new possibilities for energy generation in a world where gas is overtaking oil as the main energy supply, and where new sources of energy will also soon be overtaking gas and eventually substituting for most fossil fuel production in the planet. However, there will be plenty of energy opportunities for everybody in a continuously globalizing world, including an abundance of solar energy in Africa and the Middle East, bioenergy in the U.S. and India, and space solar power satellites in the U.S., China, Japan, and Russia, for example.

Yergin argued again that the world will never really run out of oil, but that it will be replaced by other cleaner, cheaper, and more abundant energy sources. He reminded us of the five previous times when many “experts” thought that oil was being exhausted: in the 1880s, after the first World War, after the second World War, in the 1970s with the first oil shock, and in the early 2000s with all the talk about an approaching global Hubbert peak (just like a previous Hubbert peak in the U.S. during the 1970s). However, Yergin showed that oil production, and even oil reserves, had continued to grow, if only more slowly, around the world—from the North Pole to the South Pole, and even below the poles. He ended by quoting the famous dictum by Saudi Arabian Sheikh Ahmed Zaki Yamani: “The Stone Age did not end for lack of stone, and the Oil Age will end long before the world runs out of oil.” In fact, in the early 2000s, BP, formerly British Petroleum, rebranded itself as Beyond Petroleum and started working on solar energy and biofuels. That was a clear sign of how oil companies transformed themselves into full energy companies, leaving behind their humble beginnings in the restrictive petroleum fields. Even OPEC countries had to react and begin seriously thinking, for the first time, about Life After Oil.

By 2020, gas production has indeed caught up with oil production. The supply of gas doubled between 2000 and 2020, and it overtook coal production in 2016. Now, according to most forecasts, other energy sources will also catch up in the 2030s with gas and oil, which are both declining relatively. Even though there has never been any continuous shortage of coal, oil, or gas, except for small local production problems sometimes caused by political disruptions or weather factors, the era of fossil fuels does seem to be reaching its zenith and might end in the next few decades. Indeed, other energy sources, including some not even considered today, will apparently be the dominant sector in the U.S. by 2040. (See Figure 9.) These energy “waves” will also be seen soon in most of the world. They show a clear “decarbonization” trend going from hydrocarbon fuels with more carbon to those with more hydrogen: from wood to coal, oil, gas, and maybe eventually pure hydrogen and solar energy (itself based on hydrogen).

Box 4. Search for Alternative Energy Sources
Journey to the Center of the Earth

The U.S.-EU-Japan Consortium has just embarked on a massive multipronged research venture to find technologies that can be implemented quickly, safely, and with minimum investment that will provide energy from sources other than petroleum for the next 100 years.
The senior geologist is talking to the researchers on her staff at Lawrence Livermore National Laboratory. “Well, people,” she says, “we have the piece of the research pie that’s called ‘deep drilling.’ That includes geothermal and anything more exotic that we can think of.... We got this because our nuclear weapons work gave us some familiarity with the intense pressures and temperatures found deep in the earth. We’re open for discussion.”
A young astrophysicist on the team says, “I seem to remember that back in the 1970s Tom Gold proposed that methane was produced in an inorganic process, deep in the earth, and was not from organic decay as most textbooks say. If so, it seeps upward until it gets trapped in domes and may even be forming now given the right conditions. The Russians said that Gold got the idea from them, but most of the scientific community thought the whole idea was bunk.”
Another scientist says, “But I remember that there were experiments at Carnegie Institute or Indiana Center, under Henry Scott, I think, in which granite, water, and iron oxide were crushed in a diamond mill that essentially duplicated temperature and pressure conditions in the deep mantle—12 miles or so—and presto, the water disassociated and the carbon atoms from the rock linked up with the liberated hydrogen to form methane. The iron oxide was a catalyst.”
“So,” the leader says, “I take it you’re suggesting we dig deep, really deep, to find the methane deposits and maybe the points of origin and maybe, just maybe, we’ll find that methane production is a continuous process. OK. Good enough for now. Here are the assignments. Pick your favorites.
Team 1, engineering: How can we make drill bits and down hole tubes function at depths of 20 miles, when the rocks around them are hot enough and the pressures are high enough to break down water and granite?
Team 2, experimental geophysics: Can we scale up Scott’s experiments so that we can get clear validation and corroboration of his findings at more than milliliter quantities?
Team 3, economics: What’s the cost of deep drilling? Can it pay off? And even if we are successful, just how effective will massive increases in the amount of low-cost methane be in changing the energy scene? Do we need a new infrastructure or will it fit in?
Ten years later: large-scale experiments had confirmed the possibility of continuous generation of methane in deep earth. The engineering team had pushed boldly ahead with drill bits built of nanotech materials that were harder and more heat-resistant than diamonds; high-intensity laser blasting pushed the down holes deeper. The well casings were essentially self-manufactured as the holes progressed. Drilling was taking place at 200 sites that had been identified as high probability locations by the United States and its closest allies. The project was called Journey to the Center of the Earth, after the famous Journée au Centre de la Terre by Jules Verne in 1864, or among the thousands of scientists and engineers, and the media, simply “JuiCE.”
At 20 miles they struck pay dirt, or rather pay gas: massive quantities of gas, at high pressure, contaminated only by the oxygen liberated by the reaction (which made it somewhat dangerous).
The infrastructure team was ready. Processes for converting the methane to methanol were known and methanol could be use as a liquid fuel. Since the combustion of methane is highly exothermic, it could serve as a fine heating fuel and as a source for generation of electric power. Most exciting of all, however, is the possibility of catalytic decomposition of methane into hydrogen (the start of the hydrogen economy?) and carbon nanofibers that can be extracted for other applications.
The team had produced the technology, found the resources, and identified the geophysical processes by which methane was being continuously produced. The price of oil fell from its peak of close to $200 per barrel to $50. Governments of nations dependent on income from oil exports either collapsed and fell into chaos or quickly allied with the new “energy nations.”

Figure 9. Energy “Waves” in the United States

Source: The Millennium Project based on U.S. Department of Energy

Outside fossil fuels, nuclear energy has increased marginally, and its share in the total generation of electricity has dropped by almost half, even though the third-generation fission plants might eventually regain some terrain. Several nuclear reactors have been decommissioned in Europe, and new nuclear plants have been concentrated in very few countries. Many plants became obsolete and were closed without substitution, mostly in Europe, while new plants were opened in a few countries, mainly in Asia: first China, followed by India, Japan, and South Korea. China has constructed 25 nuclear reactors in the last two decades, increasing its electrical capacity by 20 GW. Russia, similarly, built 30 reactors and brought up its share of nuclear energy to 25% of total electricity production, which allowed Russia to keep exporting more oil and gas. Otherwise, most other countries have not experimented much with nuclear energy because of its safety and environmental problems.

Furthermore, nuclear fusion has not yet been successful. The ITER tokamak fusion reactor built in southern France by an international consortium (founded by China, Europe, India, Japan, South Korea, Russia, and the U.S.) carried out its first plasma operations in 2018, with a budget overrun of 80% and two years behind schedule. But it is estimated that much more research in plasma physics is needed before electricity-producing fusion power plants might become fully operational in a decade or two. This will be an important step, since nuclear fusion is much more efficient than the chemical reactions using standard fossil fuels, and it is substantially safer than nuclear fission (nuclear fusion is the energy process of the stars and it combines two hydrogen isotopes, deuterium and tritium, to create helium). However, the technical issues to sustain a controlled plasma interaction will still need a lot of future research and might well be overtaken and rendered obsolete by “space energy” beamed from satellites.

The Energy “Internet”

Traditionally, the other main source of electricity generation has been hydropower. By 2020, however, most major dam projects have already been finished, particularly after the inauguration of the Three Gorges Dam in the Yangtze River in China. The Chinese dam was finally completed in 2010, almost two decades after the start of its construction and with a total cost of $75 billion, making it the most expensive single project in human history. Its 26 generators have a combined capacity of 18 GW, which is almost equivalent to the total nuclear power of China. Even though hydropower cannot keep increasing worldwide because of the lack of prospective sites, it still represents about 15% of total electricity generation and a bit less than 5% of total energy production around the world.

Besides hydropower, other renewable sources have been growing steadily up to 2020. Solar thermal energy has many industrial, agricultural, and home applications. Some solar thermal baseload plants—for instance, the tower of power—have become useful in certain areas: sunlight falls on mirrors, focusing on a boiler, which warms a fluid in a heat exchanger, and then steam turns conventional turbines. Silicon solar photovoltaics has also grown but it is still almost twice as expensive as other conventional sources, and it depends so much on weather conditions that it is extensively used only in isolated or remote locations where there is plenty of sunlight. However, continuous development of new plastic “nanosolar” electrical cells is about to reach break-even point. Geothermal and tidal energy have also improved a lot, but they are equally restricted to places that have the required special geological conditions. By 2020, solar power has reached 10% of total electricity capacity in Algeria, and geothermal power is 15% in El Salvador. Deep geothermal energy, sometimes called “hot rock energy,” is finally being considered in many countries, starting with Australia about a decade ago.

There are still huge differences in electricity generation from region to region, going from 90% fossil fuels in the Middle East, mostly oil and gas, to over 70% renewables in Latin America, mostly hydropower and biomass. In France, close to 80% of the electricity is produced by nuclear energy, which the country also exports to neighboring Belgium and Germany. On the other hand, countries like Brazil, Uruguay, Paraguay, Norway, and Venezuela depend on hydropower for over 80% of their electricity. Use of hydropower depends on local conditions and regional geography, and the same can be said about wind, solar, geothermal, and tidal power. In some places they are very important, but in others they are not possible at all—for example, hydropower supplies over 90% of the electricity in Norway but close to zero in the Saharan countries, and wind provides the bulk of Denmark’s electricity but nothing in Singapore. Thus each energy source is specifically important in its own region but not everywhere, and large countries like China, India, and the U.S. rely on a variety of sources of energy, which are normally connected through multiple grids.

Worldwide averages, despite the enormous regional disparities, are over 20% electricity generation from renewable sources: hydroelectricity, wind energy, and solar power each with close to 5%, followed with less than 1% by geothermal and tidal power. The rest is now provided by new biofuel sources, both natural and artificial. Renewables have been and will be the sector growing the fastest, led by new sources like biofuels. Traditional biomass consumption will fall with development and urbanization, but it will be replaced by other renewables, which will supply new urban energy needs. In addition, biofuels have had an enormous growth from close to 0% of total consumption in 2000 to almost 5% worldwide in 2020. Fortunately, thanks to the spread of local, national, regional, and global electrical grids, there is a growing balance and compensation in energy capacities around the world. Electrification has continued aggressively, and the “powerless” regions, mostly concentrated in Africa and South Asia, are shrinking. In a high-tech world, spreading grid electricity will not be the most often chosen way for isolated communities, since off-grid, decentralized energy systems are beginning to flourish, especially in regions with low population density.

In 2018, Rahul Gandhi, the heir of the Nehru-Gandhi political dynasty, became Prime Minister of India and proposed the creation of the Indo-European Electrical Network. This was partly motivated by his dream of connecting his own two worlds, the Indian subcontinent of his father Rajiv and the Italian birthplace of his mother Sonia. Rahul Gandhi signed the agreement with Angela Merkel, President of the European Union, and construction of the missing links in this energy grid started immediately. The year 2019 saw the completion of the southern route that connected India to Europe through the Middle East, which basically followed the ancient paths of the Silk Road. This southern route also relied on the Gulf Cooperation Council Grid finished in 2012 and the Mediterranean Ring completed on 2015. The northern route, from India to Europe through Russia, is still under construction in 2020, but it should officially open in early 2021.

The success of the IEEN has been so great that other countries quickly want to join now, all the way from Africa to East Asia, including Australia and New Zealand, and these connections are planned for 2022. The complete redundancy and spare capacity of the IEEN are fundamental to its functioning; every part of its decentralized and automatically redistributed electrical mesh has backups and multiple alternatives. Just as the Internet did earlier for telecommunications, the IEEN has enabled continuous and reliable electrical interconnections among peoples and nations. In fact, the new electrical grids are becoming something like an energy Internet. The differences in peak-load time from East to West and from North to South have helped to increase efficiency and redundancy to these global electric networks. This has been particularly important in order to reduce political threats and increase the electrical surplus.

The Americas had been connected since 2015, when the Pan-American Electrical Grid was completed. In fact, the PAEG was an outgrowth of the Pueblo-Panama Plan, started by Mexican President Vicente Fox in 2006 and connecting Mexico to Panama in 2010. The final electrical links between Mexico and the U.S. were also completed in 2011, and Brazil eventually got connected to all its neighbors by 2015. First the PAEG and now the expanded IEEN will achieve the dream of connecting all humanity when the electrical grid is finally closed between Siberia and Alaska in 2023. This will be a major advance for the whole planet and will bring reliable electricity to every corner of every continent.

The ideas of visionary thinker Buckminster Fuller and his Global Energy Network (www.geni.org) will soon be realized, and this will bring more contacts and more exchanges between all nations, while reducing and almost eliminating the fear of conflicts in a totally interconnected and interdependent world. In fact, Buckminster Fuller spoke of playing not “war games” but “world games” to bring peace and prosperity to every nation on Earth. Electrification has brought development to the poorest parts of the world and the continuous acceleration of growth to a globalized world. This created a virtuous cycle of energy increase and economic development. Furthermore, new technologies and better materials also improve transmission line efficiencies and reduce the cost of connecting renewable energy sources to the grid. Radically new automated grid management systems combining new chips, new sensors, actuators, and communications, and new algorithms make it possible to juggle the supply and demand for electricity more effectively across time, which is essential to getting full use from renewable energy sources, intelligent appliances, and car batteries.

From Fossil Fuels to Bioenergy

Another major piece of news in the energy industry has been the impressive growth of many forms of bioenergy, which originally started with bioalcohols in the 1970s and biodiesels in the 1990s. Bioalcohol, commonly just called ethanol for its main chemical component, has grown from almost nothing in 1980 to 20 billion liters in 2000 and almost 200 billion liters in 2020—that is, close to 20% of the total car gasoline market in the world today. Similarly, biodiesel has grown from about zero in 1990 to 1 billion liters in 2000 and around 30 billion liters in 2020, which is almost 2% of the total diesel consumption in the world.

The bioalcohol or ethanol industry started in Brazil after the oil shock in the 1970s. It had a first successful phase during the 1980s with the introduction of the first ethanol engines, but it slowly decayed in the 1990s with the decrease of oil prices. However, it had a major revival in the early 2000s with the appearance of the first flexible fuel cars. The flexifuel engines could use gasoline, ethanol, or any mixture of the two. In addition, by the time the first flexifuel cars appeared all gasoline sold in Brazil contained 20–25% alcohol, and it had an equivalent price to gasoline per mileage driven. Ethanol and flexifuel cars allowed Brazil to stop importing gasoline and start exporting bioalcohols in 2005. By 2010, all new cars sold in Brazil had flexifuel engines, and ethanol became one of the major Brazilian exports, mostly to Japan and other Asian countries. Brazil produces ethanol from sugarcane, and it has substantially increased its yield from 300 cubic meters per kilometer in 1980 to 550 in 2000 and 900 in 2020, thanks to biotechnology that has now made ethanol 20% cheaper than oil. Brazil has been so successful with bioalcohol that it is now producing ethanol-powered aircraft engines. Furthermore, some Brazilian companies are starting to replace petrochemicals with bio-alternatives. This wise business choice leaves Brazil less vulnerable to price spikes than competitors who still rely exclusively on oil and gas.

The U.S. started a similar program in the 1990s but one based on corn, first in Minnesota and other Corn Belt midwestern states. Minnesota had 10% ethanol in all its gasoline and 20% was required by law beginning in 2013. Soon other states followed. In Europe, E85 fuel (a mixture of 85% ethanol and 15% gasoline by volume, also sometimes called bioalcohol BA85) was doing well in Sweden and quickly spread through much of Europe. However, higher costs in Europe and the unavailability of more land have impeded any faster replacement of gasoline. Biodiesel started in Europe where there was an important fleet of diesel vehicles and it could be produced from a variety of sources—from soybeans to rapeseed to algae.

India started a very successful pilot plan in 2006 to produce 10 million liters of biodiesel on 8,000 hectares of marginal wasteland with Jatropha curcas, a nonedible oil crop that is drought-resistant. The experiment was so successful that BP and the New Delhi–based Tata Energy Research Institute started commercial production in 2016 after increasing the yield per hectare by 400% thanks to biotechnology. The biodiesel fuel program started as a cheap alternative fuel to the typical Indian three-wheeled diesel motor rickshaw, and the fuel now is beginning to be exported. There is a limit to such exports, however, since India has little marginal land and it needs its arable land for food production. Biofuels based on cellulosic ethanol, which is made of more abundant and less expensive biomass using a variety of bacteria, yeast, and enzymatic processes, is now proving very successful in many countries.

Transportation (by land, air, or sea) still consumes about 20% of the total energy supplied worldwide and about 60% of the oil produced. That is why the advance of biofuels has been so important, particularly with car ownership rising tremendously around the world. For example, in China personal transportation was mostly by means of bicycles in 1980, but there were 10 million private cars in 2000 and almost 80 million in 2020. There is still much room for expansion, since this represents only 6 cars per 100 people in China versus 80 in the U.S. (for a total of 260 million cars in the U.S.). The Chinese growth in car use has been incredible, however, it will soon be replicated by other countries moving up the economic development ladder.

Thanks to its rapid growth, China has positioned itself as the most efficient producer of the most efficient cars on the planet. China now produces over 10 million cars per year, almost as many as Europe, Japan, or the U.S. Nonetheless, the Chinese ones are the most energy-efficient, with miles per gallon ratings of over 100. China copied the flexifuel cars from Brazil and combined them with the hybrid cars from Japan (gasoline-electric vehicles, which use gasoline and electric batteries to power internal-combustion engines and the electric motors) to create hybrid flexifuel cars that also run on electrical energy with nanobatteries.

The U.S. passed Corporate Average Fuel Economy regulations in 1975 and slowly increased the standards for normal engines to achieve 25 mpg by 2000, when the first Japanese hybrid cars by Toyota reached 50 mpg (and all Toyota cars sold after 2012 were hybrid, getting 60 mpg or more). Brazilian cars of the early 2000s added the possibility of combining different fuels in variable mixtures, since the engines had internal control mechanisms to adjust their functioning to changing fuel conditions, while the first European commercial electric cars transformed chemical energy stored on the vehicle in batteries. In 2015, the Chinese created the first sophisticated electrical engines with nanobatteries for hybrid cars with flexifuel engines. These “electric-flex-hybrid” cars have now become a major export from China, and GM (Guangzhou Motors, the main manufacturer in Guangdong province) expects to keep developing better batteries, thanks to the continuous breakthroughs in nanotechnology, to reach 120 mpg by 2022. (And some experts also plan to incorporate fuel cells into these cars once their costs come down enough.) The new cars are not only cheaper but also run on any possible combination of biofuels and electricity. This reduces fuel emissions substantially since the cars can also be plugged in anywhere along the energy Internet, and they are readily and cheaply reparable (for example, construction is modular so that items such as batteries can be fully recycled as well as reused in other vehicles). The new Chinese electric-flex-hybrids are revolutionizing the world in the 2020s even more than the Ford Model T changed the U.S. in the 1910s.

The Cells of Life

The present energy and transportation revolutions also include creating biofuels directly from living cells—not from long-dead fossil fuels or from recently harvested sugarcane or palm oil, but from real living cells. In fact, generating and using energy is what life is all about. Every child today knows that plants transform carbon dioxide and water into carbohydrates and oxygen. Indeed, that is simply called photosynthesis and its chemical expression is:

CO2 + 2 H2O + light ––> (CH2O) + O2 + H2O

Thus, plants use light and some simple chemical molecules to create carbohydrates, which are really nothing more than hydrocarbons plus oxygen. In addition, about 114 kilocalories of free energy are stored in plant biomass for every molecule of CO2 fixed during photosynthesis. Solar radiation striking Earth on an annual basis is equivalent to 174,000 terawatts (which is several thousand times the current global energy consumption), and only part of this light is used for photosynthetic energy capture. Approximately two-thirds of the net global photosynthetic production is terrestrial (land-based), while the remainder is produced mainly by phytoplankton (microalgae) in the oceans, which cover approximately 70% of the total surface area of Earth. Since biomass originates from plant and algal photosynthesis, both terrestrial plants and water microalgae are appropriate targets for increasing biomass energy production.

Plants do it, most algae do it too, and even some very simple bacteria can fix carbon dioxide and water to produce carbohydrates and oxygen under the influence of light. In fact, many simple cells can do photosynthesis and similar biochemical processes. Making hydrocarbons is one of the simplest biological processes, as a famous report by the UN Food and Agriculture Organization explained late last century. Hydrocarbons are not complicated molecules with thousands of atoms and a number of elements, like proteins and enzymes; they are just small molecules with two of the most common elements on Earth: hydrogen and carbon. Surprisingly, it took many scientists and many years to artificially create the first commercial hydrocarbons from living carbohydrates and not from fossil fuels.

Craig Venter, one of the biologists who sequenced the human genome in 2000, later founded a company whose purpose was precisely to create life. In fact, Venter famously said that he spent 20 years of his life trying to “read” life and that he would expend another 20 to “write” life. His company, Synthetic Genomics, was one of the pioneers dedicated to using modified microorganisms to biologically produce alternative fuels like ethanol and hydrogen. In fact, many other such enterprises followed soon, and the first artificial life forms, virus and bacteria, were created in 2003 and 2005. In 2018, one of Venter’s research associates, Mohan Kapoor from India, was the first who managed to create artificial bacteria to economically produce hydrocarbons. He had been working since 2015 with Clostridium acetobutylicum and other bacteria until he managed to tailor-make a new hybrid organism that efficiently produced hydrocarbons from carbon dioxide and water under controlled lighting.

C. acetobutylicum is a commercially valuable bacterium, sometimes called the Weizmann Organism after Chaim Weizmann, who in 1916 helped discover how C. acetobutylicum cultures could be used to produce acetone, butanol, and ethanol from starch using the ABE process to satisfy such industrial purposes as gunpowder and TNT production. The ABE process was an industry standard until the 1950s, when low oil costs drove production to more efficient methods based on hydrocarbon cracking and petroleum distillation techniques. C. acetobutylicum also produces acetic acid (vinegar), butyric acid (a vomitous smelling substance), carbon dioxide, and hydrogen. These technologies are proving so successful that they are now being used to start factories that use cellular processes to create efficient organisms to digest heavy oil and get more of the residuals. Other planned energy projects involving these new biotechnological developments include producing ethanol from bark by using microbes and genetically modified salt-resistant rice and extracting shale oil and tar sands with bacteria.

Mohan Kapoor called his new bacterium Petroleum artificiali and started a marketing test in November 2019. It is expected that his bacterium that “eats” carbon dioxide and “drinks” water under light, 24 hours a day, in order to “excrete” hydrocarbons will truly revolutionize the world. Not only will it produce hydrocarbons continuously, but it will also capture carbon dioxide and generate free oxygen and energy. If there are no major problems, production of new fuel excreted by P. artificiali will become financially viable in 2021 and will take care of the carbon sequestration problem. Other scientists are now working on more specific bacteria to generate ethanol, methanol, and pure hydrogen. This will eventually allow us to artificially produce all kinds of biofuels according to specific needs, trying to get the best fuel value or relative energy density (that is, the quantity of potential energy in fuel, food, or other substance; see Table 3).

Table 3. Relative Energy Density of Different Fuels

Source: The Millennium Project based on IEA and US Department of Energy

Some fundamentalist ecologists have started to complain that a full environmental impact analysis has to be performed on such artificial organisms, since they could destroy the delicate balance on Earth. They argue that the processes may work in the laboratory but may have large impacts when scaled up to achieve meaningful production quantities. They worry about escaping molecules and about interfering with natural evolutionary processes. There are even objections from religious fundamentalists of all sects. However, the public is realizing that this is nothing more than a new scientific breakthrough, like the Green Revolution that increased agricultural yields and avoided the starvation deaths of millions of Indians in the 1970s.

More recently, the new bacteria can be compared with the biologically engineered Chinese chicken wings grown directly from chicken stem cells in 2014 without the need to actually reproduce a whole chicken to be killed later for its wings and other body parts or with the Japanese Kobe beef produced genetically from premium cow cells in 2015 without having to grow cattle to be later slaughtered. The “chickenless” Chinese chicken wings and the “cowless” Japanese Kobe beef are also over 10 times cheaper to produce and totally avoid any risks of animal problems, including avian flu or mad cow disease, and they eliminate the methane production and waste streams from beef production. Both of these products have been massively and successfully produced by GM2 (Guangzhou Meats & Meals, the main “meat creator” in Guangdong province), for worldwide exports since 2016. In fact, even McDonald’s advertises its new “cowless” hamburgers based on ethical grounds, since they don’t butcher any animals and the hamburgers are much cheaper and nutritious than the non-genetically produced ones. People in some African and European countries are still opposed to these genetic foods, however.

Space and the Future

The other important cells for current energy production are the fuel cells that convert biofuels into electrical energy. Fuel cells were first industrialized during the 1960s by NASA in order to generate electricity for the Apollo missions, and they were later used in the space shuttle and the International Space Station. Fuel cells have very high efficiencies in converting chemical energy to electrical energy, since they are not constrained by the maximum Carnot cycle efficiency, as combustion engines are. A combustible fuel reacts with oxygen in a fuel cell to transform chemical energy into electricity with efficiencies of more than 60% today, as compared with only 40% at the start of the century.

Fuel cells are being used almost everywhere, in homes, industries, cars, and even rockets. They can also use many types of fuels, from pure hydrogen to landfill waste gas, in order to produce electricity. If pure hydrogen is “burnt” with oxygen, then water is the only emission. If hydrocarbons are used, then carbon dioxide is also produced; and the more carbonated the hydrocarbons are, the more carbon dioxide will be emitted. The main problem with fuel cells is their high cost, which has been reduced but it is still elevated in 2020, even with high-temperature and catalysis breakthroughs. Nanotechnology is currently being used to try to lower the manufacturing costs of fuel cells, just as was done with nanobatteries after 2015.

In addition, the vehicular cost of using hydrogen with fuel cells has come down from 8¢ per mile in 2000 to 3¢ per mile in 2020, but that is still 50% more than the cost of fuel for hybrid flexi-fuel internal combustion engines. Compared with other hydrocarbon fuels, the costs of using fuel cells and ICEs are similar, which is why the Chinese electric-flex-hybrids do not use pure hydrogen as fuel. However, the cost of the fuel cell itself is still elevated, and disposing of them is dangerous since they are highly contaminating, but fuel cells convert energy with over 60% efficiency versus 20% for ICEs. Ethanol is an excellent combustible, since hydrogen-rich fuels like methanol or ethanol (methane hydrate, natural gas, gasoline, diesel, and even gasified coal), just produce heat and water, plus some carbon dioxide depending on the hydrocarbon molecular weight.

Hydrogen is the most abundant element on Earth. It is the basic component of water, not to mention virtually every fuel ever used by humankind—wood, oil, coal, and natural gas—all of which are made of hydrocarbons. Pure hydrogen, however, does not occur naturally: hydrogen must be harvested using electrical or chemical processes, which have their own hidden environmental consequences; hydrogen is only an energy carrier and it has to be produced from water or hydrocarbons. Obviously, using renewable resources to power those processes could vastly reduce the environmental footprint of hydrogen production; at present, however, producing hydrogen for fuel costs several times more than conventional fuels do.

Since the start of this century, Iceland has made a major effort to become the first “hydrogen economy” in the world, and its advances by 2020 are notable. Nonetheless, this is the special case of a country with overabundant and readily available hydroelectric and geothermal energy that can be used to produce hydrogen as a carrier or storage of energy for later use. The hydrogen produced in Iceland is mostly for transportation, since for other activities it is more convenient to create electricity directly, without intermediaries (just like making Japanese Kobe beef without the intermediate step of the cow). The hydrogen for cars is later used by the fuel cell to transform its chemical energy into electric and mechanical energy to drive the car. Iceland, a country with excess energy, has chosen to electrolyze water and began exporting the hydrogen contained in high-pressure tanks, and in the form of metal hydrides, since hydrogen is released from the hydrides with just a bit of heat.

Hydrogen has not yet become the main energy commodity, as dreamed of by many in the early 2000s, because it is still costly to produce, dangerous to store safely, difficult to transport, and tricky to distribute, and its volumetric energy density is much lower than that of other liquid fuels like ethanol or gasoline (although not in the form of metal hydrides). Safety would be another problem and a major worry; it would take many years to accomplish the logistics and infrastructure changes required to move from standard liquid fuels to hydrogen. The best idea here seems to be the “hydrogen battery,” a block of metal hydride storing hydrogen at densities higher than liquid hydrogen. When a hydrogen-powered car needs a fill-up, the “gas stations” of the hydrogen era would simply exchange the hydrogen batteries, probably automatically.

Continuous research is being carried out to increase the efficiency and reduce the costs of the so-called hydrogen economy. Even the use of advanced fission nuclear plants is still considered to electrolyze water and produce hydrogen. Likewise, R&D on high-temperature solar dissociation of water to make hydrogen has progressed, but awaits solution of other difficulties. The theoretical potential of hydrogen as a clean energy carrier is certainly incredible, but it is not economically competitive since it is not freely available. Hydrogen is, after all is said and done, only an intermediate energy medium and an ill-conceived fantasy according to many. It is an energy carrier, not an energy source. Electricity is also a carrier—and a much better one in many ways. An efficient world energy economy would certainly continue to use more and more electricity as one of its carriers, particularly for use in industry and large buildings. For cars, the sustainable economy of the future may well use some mix of electric batteries, heat batteries, and methanol, instead of hydrogen, as primary energy carriers (at least for as long as it costs more to produce than to use hydrogen).

The new space race has also had some very important consequences for the energy sector. The Chinese landed on the moon in 2015, as promised, and the Russians followed one year later, after resurrecting their rocket technologies of the 1950s and 1960s. A combined European, Japanese, and U.S. manned mission landed there in 2017. A moon base called Luna 1 was started in 2019, and Nikolai Sevastyanov, Honorary President of RKK Energiya, just announced plans to begin mining the moon to bring helium 3 to Earth in the Russian Kliper spacecraft. According to Sevastyanov, there is enough helium in the Moon to power all human needs for at least a century. Indeed, the binding energy of helium is much higher than nuclear fission and even than hydrogen nuclear fusion. However, the space race has opened new and easier sources like space solar power satellites.

The Japanese have been experimentally using robotic “spiders” to build large-scale structures in space for over 10 years. The tiny mechanical spiders inch their way across large nets of fabric in space, performing small tasks or lining up to create an antenna or some other structure. The concept is known as a Furoshiki satellite after the Japanese word for a cloth used to wrap up possessions. It has recently been revolutionizing satellite-based applications such as telecommunications, navigation, and Earth observation using radar by providing cost-effective large antennas in space that can be launched on relatively small rockets. More important, the Furoshiki spacecraft could be a viable way to create large space solar power satellites to then beam energy to Earth. In fact, the amount of energy received from the sun in Earth’s atmosphere is enough to power 1,000 civilizations like ours. That kind of energy is what was called a Type I civilization in the energy scale devised by Russian astronomer Nikolai Kardashev in 1964. (See Table 4.) The famous English-American physicist and mathematician Freeman Dyson had similar ideas about more advanced civilizations building spheres around their suns in order to capture all the radiated energy. He even proposed searching for indications of such spheres having already being built by other civilizations.

A Type I civilization is one that is able to harness all the power available on a single planet (in our case, Earth has an available power of 174 × 1015 W). A Type II civilization is one that is capable of harnessing all the power available from a single star (approximately 386 × 1024 W for our sun), while a Type III civilization would be able to harness all the power available from a single galaxy (approximately 5 × 1036 W for the Milky Way, but this figure is extremely variable since galaxies vary widely in size). A Type IV civilization will have control of the energy output of a galactic supercluster (approximately 1046 W), and a Type V civilization will control the energy of the entire universe (approximately 1056 W). However, such a civilization approaches or surpasses the limits of speculation based on current scientific understanding and may not be possible. Frank J. Tipler’s “Omega point” would presumably occupy this level. Finally, some science fiction writers talk about a Type VI civilization that will control the energy over multiple universes (a power level that is technically infinite) and a Type VII civilization that will have the hypothetical status of a deity (able to create universes at will, using them as an energy source). Table 4 shows the power in watts produced by various different sources of energy, listed by increasing order of magnitude.

According to Kardashev, our civilization is still at Type 0, but it might reach Type I in the twenty-second century. In the year 2020, we know that we still have available a variety of resources to create a diversified energy matrix depending not on one single energy source but on a mixture of alternatives, at least during this critical transition period.

Earth, the sun, the galaxy, and the universe have more than enough energy resources to power our civilization for the next decades, centuries, and millennia. With the proper technology, it is basically a matter of costs and priorities. Converting the energy resources into available supplies can be done, but it will certainly take massive investments and lots of imagination, creativity, science, and engineering. All resources are obviously finite, but some are almost potentially inexhaustible even with an accelerating growth and rapid technological change. Methane hydrate mining, hydrogen and helium, nuclear fusion, solar energy capture, mass-energy conversion, and antimatter fuel generation are all eventually possible. Our civilization is still in its infancy, and barring any wild cards, geopolitical crises, environmental disasters, or extraterrestrial contacts, technology will keep pushing off the limits to growth.

Table 4. Energy Scale and Kardashev Civilization Types

Source: The Millennium Project based on Wikipedia.



Scenario 4. Political Turmoil
Moderate growth in technological breakthroughs
Low environmental movement impacts
Moderate/low economic growth
Major changes in geopolitics and war/peace/terrorism

The failure of nation-states and international organizations to make serious decisions is making them irrelevant. Political conflicts over oil are increasing. Transnational organized crime syndicates—with nearly three times more money than that of all the 2020 military budgets combined—play out their power struggles through governments, corporations, and even NGOs. Systems of all kinds—from medical records to financial transfers—have become so complex that individuals are bewildered and even “experts” are lost. Media empires have unwittingly countered much of the moral underpinnings of society with an “anything the market wants” attitude. The health and retirement costs of the aging populations around the world have forced many governments to cut benefits for all ages, which has led to increasing protests and general strikes. Selfish individualism seems to be replacing communal values, making international law meaningless. Global climate change continues. Terrorism has increased because too many see the governing systems as unjust, and international cooperation is breaking down. Migrations of the poor to the rich areas spark riots and expose the horrific income gaps. There is a real fear that the world is slowly being taken over by high-tech warlords, as growing numbers of economic and environmental refugees roam Earth.

The most dramatic of the recent migrations are the Afro-Indo-China water migrations into Europe and North America, which have triggered a series of ethnic and racial conflicts with no end in sight. The EU and NATO create political stability in Europe only for short periods of time until the next eruption occurs. The U.S. economy was so weakened by the costs of wars in Iraq, Afghanistan, and generally against terrorism that it was difficult for it to play a role in reducing conflicts around the world. The EU was not able to reach agreements on strategies to replace the U.S. roles. UN peacekeeping forces were overstretched and underfunded. Conflicts in Saudi Arabia, China, Iraq, Angola, the Caucasus, China, and Nigeria over the past two decades have made oil supply irregular and kept oil prices above $150 per barrel for the past several years. As a result the world seems to be in a perpetual state of stagflation.

Terror Version 2.0

Prior to the multiweapon world attack on September 11, 2011, terrorists used only one medium at a time. The combination of conventional explosives, dirty bombs, and bioweapons changed the world forever. This was a well-planned, fully coordinated, and expertly executed simultaneous attack on oil systems, airports, and cities. The world is still stunned and bewildered by the events and consequences of Terror2, as it came to be known. Three twinned dirty bombs were detonated, one each in Europe, Asia, and North America. Twenty-six of the world’s major oil extraction sites, 13 refineries, 100 supply depots, and three shipping lane choke-points were hit with conventional explosives within several minutes of each other around the world. This reduced oil supplies by 20% for almost a year. On the same day, 19 terrorist-martyrs, who had previously ingested individual disease packages, infected passengers in the busiest airports of Europe, Asia, and North America. The price of gasoline quintupled overnight, spot prices were never more volatile, long-term contracts for oil were abrogated, trading in carbon rights was suspended, electricity and gas disruptions multiplied, many banks closed, and transportation-dependent supplies were missing, closing factories and causing food shortages around the world, which was now in the grip of fear and suspicion.

Terror2 brought many of the world’s airlines, medical systems, and tourist industries to their knees and the global economy to a depression, from which we have now recovered—but only to a series of recessions and periods of hyper-inflation. Economies have turned inward, politics have become more nationalistic, and religion less ecumenical. Ad hoc demonstrations against incompetent governments erupted around the world, which went into the depression with increased poverty. Within six months the increased inflation caused some banking systems to collapse, unemployment rates to double, and businesses to migrate from emerging markets to advanced countries. Many who were accustomed to relatively high standards of living had to suddenly return to the conditions they had only heard about from their grandparents or seen in movies of poorer countries.

There could be no mistake about the sophistication of the planning behind this shocking multicontinent, multiweapon set of attacks. The failure to distinguish between modernization and westernization kept militants unwilling to seek alternatives to wiping out the “forces of cultural hegemony.” Rumors persist that an alliance of political Islamist militants, environmental terrorists, and several organized crime groups made it happen. With the manipulation of media by many players for many purposes, people did not know whom to trust about these events and they have increasingly withdrawn to more local identities and loyalties. There is an unsettled feeling among some people that some governments must have known in advance about such a large set of attacks. Transnational organized crime and terrorist groups could not have grown to have such sophistication and coordination by 2011 without several major governments becoming aware. Or is it that the organized crime groups and enough government personnel and computer systems are so interlinked that it was indeed possible?

In any case, the disruption of the Pan European pipeline that delivered oil to Europe from the Caspian Sea area and Russia placed Europe in a very tight supply situation for about six months. During this time gasoline rationing was instituted. There were frequent electricity brownouts across Europe as a result of the shutdown of the natural gas pipeline that ran from Turkmenistan to Europe through Azerbaijan, Georgia, and Turkey. The Baku-Tbilisi-Ceyhan pipeline was designed to make Europe independent of Russian oil supply and the threat of a Russian oil monopoly, but cutting this pipeline made Europe once again reliant on Russia’s oil. Russia would have been glad to fill the gap, but its oil and natural gas production was also disrupted.

The major OPEC countries were having troubles of their own. The Red Sea export port of Yanbu in western Saudi Arabia was closed as a result of an effectively placed bomb, and in Iraq, Basra’s oil terminal suffered huge damage from a waterborne attack by suicide bombers. In Canada, bombs shut down the Alberta production of oil from tar sands and oil exports to the U.S. from Canada essentially stopped. Oil rigs in the Gulf of Mexico also came under waterborne suicide attacks, and 15 of them were shut down. In Iran, the North Sea, and Alaska the story was the same. Other targets were the Chunnel that connects the UK and France; Saudi Arabian export facilities at Ras Tanura, Abqaiq, and Jubail; and several nuclear power plants, although these suffered no damage due to their heavy reinforcement.

The situation was incredibly difficult because of the simultaneous need for repair crews, firefighting equipment, replacement pipeline sections, and—most of all—energy, which was now in short supply, to make repairs on the damaged facilities. Many industries shut down completely, countries were paralyzed, economies faltered, travel came to a virtual halt, and security intensified. But of course the new security measures guarded against the last, not the next, threat. What really needed to be done was to restore a certain minimum of social order in the short term and to have a serious and worldwide reflection on the root causes. Previous efforts to do so did not work.

A worldwide social contract was signed, which brought into being the emergency international and transinstitutional plan to respond to collapses due to future Terror2-type attacks, which included ubiquitous sensors, computers, satellites, and a massive worldwide intelligence campaign to determine intentions, at the individual level, to enable preemption. NGOs, universities, and religious organizations tried to improve civility by reinforcing the familiar vows, training teachers in teaching tolerance, and producing media campaigns that highlighted the common values that underlie peace in all cultures and religions. However, the root causes are still not addressed seriously enough to this day to make the world better than before Terror2.

The world seems to have been in a daze for the past nine years. Even before Terror2, however, world leaders knew there was increasing political alienation, widening income gaps, a growing number of failed states, falling water tables, spreading new diseases, rationing of commodities, and skyrocketing energy prices. Yet they failed to act to make a difference. In energy, for example, there were many early wake-up calls about impending political turmoil: the fluctuating price of oil since the beginning of the twenty-first century, the reduced discovery rate of new reserves, the pleas for rejecting the world’s addiction to oil, the wars in the Middle Eastern oil-rich countries, the growing concern that the world had passed “peak oil,” and the sharp increases in energy demand in China and India, to mention just a few of the signals that were well above the horizon long before 2011.


Oil Problems Created Political Flash Points

Oil-related political hot spots occurred in the Caucasus, China, Japan, the Arctic, Nigeria, the Persian/Arab Gulf, Russia, Venezuela, and Antarctica, where demand had finally shattered any semblance of accord on preserving the natural heritage. Here’s a brief overview on what happened in some of these areas.

The Caucasus

Following years of tensions between the Russian Federation and the Republic of Georgia, the situation finally came to a head in 2009 (two years before Terror2) over domestic terrorism and irredentism. This was a preview of the turmoil to come. An undeclared war erupted, causing interruption of the flow of oil and gas in the Baku-Tbilisi-Ceyhan Pipeline and the South Caucasus Pipeline. As a result, Azerbaijan’s economy collapsed under the strain and civil unrest erupted. Armenia took advantage of the civil war by igniting a conflict over the Armenian ethnic enclave in Nagorno-Karabakh in Azerbaijan. Armenia annexed the enclave as well as vast portions of western Azerbaijan, including sections that contained important portions of the two pipelines. Turkey’s economy suffered due to problems with the energy flow, and the formerly moderate ruling party of Turkey, the Islamic Justice and Development Party, began to lean further right in order to deal with an angry constituency and to avoid defections to more religious parties.

Figure 10. The Caucasus Region

Source: Energy Information Administration

This in turn caused stress between the Turkish government and the Kurdistan Workers Party, which declared autonomy in the southeast. The Turkish government, assisted by the Shi’a factions of the new Iraqi government, who were afraid of strengthening the Kurdish parties in the Iraqi government, sent troops, effectively ending a five-year truce with the Workers Party.

The EU froze Turkey’s accession talks, which pushed Turkey further into the Middle Eastern orbit. Iran’s power and influence grew in the region, and its overt support for the Shi’ites in Iraq effectively ended the tenuous Iraqi national cohesion. Tensions and undeclared wars increased, while alliances formed among terrorist groups of Iran and Iraq and the variety of warlords across the region that we see today.

Northwest China

The largest oil reserves in China are in Xinjiang in northwest China, where a pan-Islamic or pan-Turkic separatist movement has been growing for years among the Uighur people. Conflicts between the Xinjiang Liberation Organization/Uighur Liberation Organization and police have increased support from the Uighur diaspora and widespread sympathy from the Uighur population, including the induction of new recruits who were trained in guerrilla tactics. The Xinjiang-Shanghai Pipeline was a key target for several separatists’ attacks, making the delivery of oil and gas to the Chinese coastal cities no longer reliable. These cities were important to the success of the Chinese Communist Party, and people began to lose faith in the government’s ability to manage the energy price fluctuations. Anti-government demonstrations began. Nothing changed. The government blamed the ULO for fluctuations in energy prices.

Figure 11. China

Source: Magellan Geographix, Santa Barbara, CA

In counter-demonstrations in the richer cities in the coastal regions, people expressed anger toward the Muslim Uighur. There were racial and anti-Islamic overtones. A new wave of protests by the Uighur broke out in Xinjiang, which in turn were met by police violence. Most in China supported the crackdown on the Uighur and the imposition of martial law in areas of Xinjiang where ULO activities were the strongest. This incited the more moderate Uighurs, who called on the Islamic insurgents from the Central Asian republics and the Middle East to assist their new pan-Islamic Uighur state. This led to the current state of civil war in northwestern China and quickly reduced China’s oil production, further accelerating its efforts for increased international oil access beyond the 8 million barrels of oil per day it was consuming.

China was able to leverage its vast holdings of U.S. debt to prevent U.S. criticism of its civil wars and tactics. As a result, the uprisings were suppressed with a very heavy hand in an effort not to lose territorial coherence. When the U.S. complained, China switched from the dollar to the euro as its international monetary standard and began to foreclose on some of the U.S. debt. China’s increasing power within the UN Security Council prevented any discussion of Chinese internal actions. Nevertheless, the separatist groups were strong enough that oil from Western China was no longer reliable, forcing China to increase pipeline access to Russian oil. It did, however, stimulate Chinese alternative energy efforts in solar-powered fuel cell technology, biofuels from the coastal seawater agriculture regions, and wind energy, while increasing its import of Australian liquid natural gas.

China and Japan

Tensions between China and Japan had been growing for two decades over the control of oil and gas fields in the East China Sea. They flared up when Japan accused China of siphoning oil from the Japanese exclusive economic zone. China and Japan began to draw from the same reserves as rapidly as possible.

Figure 12. East China Sea

Source: BBC

Japan accelerated its effort when Russia agreed to provide its oil pipeline access to China instead of Japan. This made it politically impossible for Japan to make any compromise on the gas fields in the East China Sea. Further complications were conflicting treaties. Japan claimed the area under the UN Convention on the Law of the Sea that allows coastal countries to claim an economic zone extending up to 370 kilometers from their shorelines. Both Japan and China are parties to this agreement. China claims the area under the 1958 Geneva Convention on the Continental Shelf that allows coastal countries to extend their borders to the edges of their undersea continental shelves.

Although weakened politically and economically by the costs of past wars and the current need for energy, the U.S. was able to send its Seventh Fleet on naval maneuvers near the disputed area, and then China and Japan agreed to take the issue to the World Court in The Hague. Tensions still remain high while the oil and gas pumps are on hold, and Japan increased its competition with China for Australia’s liquid natural gas, while playing different elements in China against each other and accelerating its efforts to extract ocean-bed methane hydrates, for which environmentally safe technologies do not yet exist.

The Arctic

Climate change continues to melt the polar ice. Huge resources have become more and more accessible in the Arctic, where a quarter of the world’s undiscovered oil and gas are estimated to reside. Norway, Denmark (through Greenland), Russia, Canada, and the United States are competing for access. The dispute revolves around the different methods of determining maritime frontiers. The median line method, supported by Canada and Denmark, would divide the Arctic Sea between countries according to their length of nearest coastline. This would give Denmark the Pole itself but Canada would gain as well. The sector method would take the North Pole as the center and draw lines south along longitudes. This would penalize Canada, but Norway and, to a lesser extent, Russia would gain.

The United States and Canada argue over rights in the Northwest Passage, Norway and Russia disagree over the Barents Sea, Canada and Denmark are competing over a small island off Greenland, the Russian parliament is refusing to ratify an agreement with the United States over the Bering Sea, and Denmark is seeking to trump everyone by claiming the North Pole for itself. The United States has yet to sign the UN Convention of the Law of the Sea. If the World Court does not resolve these issues or takes a long time, or if one or more parties do not accept its ruling, then private capital insured by governments and backed by gunboats will invest in hopes of gaining oil and gas, while preparing to pay retroactive penalties. To keep this from becoming a hot spot for confrontation between former allies, quiet face-saving deals are in preparation to pay royalties to those who cede access.

Figure 13. The Arctic Region

Source: BBC News

Nigeria

Nigeria should and could be a key player in the development of Africa and new sources of oil, but political turmoil keeps preventing sufficient investments to achieve that potential. Rightly or wrongly, oil companies operating there have been severely criticized because of their environmentally unfriendly extraction practices and their failure to condemn human rights violations. Pipeline vandalism has long been a problem in Nigeria. Pipeline fires, dynamiting of Shell’s pipeline in the Opobo Channel, attacks made on the Forcados terminal, attacks on the Escravos pipeline, kidnappings of expatriate oil workers in the Niger Delta region: all of these prove the depth of the resentment felt by the Ijaw people who live on the river Niger.

Ijaw leaders have been associated with the Niger Delta People’s Volunteer Force. In recent decades the resentment among the Ijaws has grown since they have seen little of the rich returns from the oil resources in their region.

Organizational cohesion and arms procurement of the NDPVF rose significantly with funds extracted from the widespread sale of stolen oil and from support of the Ijaw diaspora in the United States and elsewhere. Over time, the NDPVF became a serious threat to government security forces. Contrary to its original guerrilla hit-and-run tactics, for the first time militiamen seized and held oil-sensitive territory and a refinery. Most likely they were players in the September 11, 2011, actions in Nigeria. When diplomatic negotiations failed and Nigeria labeled the NDPVF a terrorist organization, heavy arms became available to the militiamen in the occupied territory. The NDPVF has become a serious threat to the Nigerian federal authorities, with the group spearheading a secessionist movement that keeps Nigeria in a state of instability. Although it still has one vote in the United Nations, Nigeria is really broken along religious and ethnic lines, with organized crime controlling oil exports, which remain too low for it to be a key player in oil supply.

The Persian/Arab Gulf

As a result of these conflicts and falling reserves around the world, the importance of the Gulf Region has increased. As oil supplies dried up around the world, small Gulf States have become increasingly nervous about big power conflicts. There is an old African saying, “When great bulls fight, only the grass underneath gets hurt.” The Gulf States did not want to get trampled by the competitions among China, India, and the United States.

Figure 14. The Middle East

Source: Center for Defence Information, 2002

Saudi Arabia had been modernizing and beginning to hold democratic elections when Terror2 hit the world in 2011. It empowered the extremists within the political Islamist movements to claim their time was at hand. Religious campaigns in the streets, political sermons in mosques, and scathing articles in newspapers condemned corruption and advocated the need for change. The extremists surprised the world and won the first national election, selecting their Prime Minister for Saudi Arabia. However, the victory was short-lived. With about 3,500 princes and countless informal deals with power brokers around the world for several generations, the royal family was strong and deeply embedded in all aspects of Saudi government and society. Old debts were called in from governments, corporations, and individuals. Civil war broke out between different factions within the country, resulting in Saudi Arabia being broken into several parts, with an uneasy truce holding today.

The future of Saudi Arabia and the Gulf Region seems to depend, more than ever, on western powers to protect sea lanes and pipelines while the region develops democratic forms of government under an Islamic framework, making distinctions between modernization and westernization.

Other Factors Making the World More Unstable

The daily struggle of 30 million AIDS orphans without love or mercy turned so many in Africa to crime networks that roving gangs eventually made political stability impossible in many countries. Water shortages across much of India and China had induced migrations of people in unsettled conditions, and migrations of the poor to the richer areas have caused civil strife around the world, which continued the political turmoil.

Meanwhile, Russia, Europe, and New Nuclear Plants

Russia had no fuel supply concerns that would have led it to use nuclear rather than fossil power plants. As possessor of a huge nuclear arsenal, Russia had no need for a commercial nuclear sector to disguise weapons work. Yet the government decided to pursue the nuclear route for domestic electricity and to export its fossil fuels. Absent the regulations and litigious NGOs of the West, this strategy allows it to export the hydrocarbons that it would otherwise use internally.

Russia built dozens of nuclear reactors for several reasons. By building these plants, the country further developed a technology that it thought might someday be exportable. In addition, excess electricity production would allow Russia to supply nations previously in the Soviet Union, bringing them further into Russia’s economic orbit. The Russian plan, now largely accomplished, was to build about 40 new nuclear reactors in order to increase the share of nuclear energy in the nation’s energy balance to 25%. Although many experts forecast that a means for safe storage of nuclear waste is likely by 2030, the increasing opportunities to hijack radioactive waste during transport are still a worry. It was during transport that such radioactive wastes found their way into the “dirty bombs” of September 11, 2011. Nevertheless, the designs for the new Russian nuclear plants were a step forward. They were specifically designed to be secure from terrorist attacks and, based on the Chernobyl experience, to be as free as possible from human or mechanical malfunction.

One of Russia’s most important energy exports was and still is natural gas. In a series of power moves between 2005 and 2008, private ownership of energy resources was replaced again by state ownership, clearly a step back toward the old days. This shift was evident when the Yukos natural gas venture was terminated and Gazprom (the state-owned company) became the natural gas monopoly. Natural gas is delivered from Russia to Europe in a 1,200-kilometer, $5-billion pipeline along the Baltic seabed. It was almost destroyed in the 2011 attacks but now is repaired. It provides Gazprom with a direct route to the European markets and bypasses Poland and the Baltic states.

Europe still relies heavily on the exported Russian gas and hence has a interest in trying to keep Russia politically stable, which may not be possible. Therefore, the EU sought to diversify its energy supply by developing coal gasification technology, wind, solar, and other forms of renewable energy sources. Nevertheless, the importance of the Russian gas led the EU to political compromises in the UN and in trade agreements that might not have been necessary in other circumstances. Europe is still trying to formulate a common energy policy that will help assure continuing and stable supply.

Unstable Oil Supply Forces the U.S. and Canada Closer Together

Canada has joined the ranks of major energy exporters with its development of tar sands, bitumen, and heavy oils. As a result, its relationship with the United States has become much closer, since it is now a supplier of a strategic energy commodity. Canada has the luxury of selling part of its energy resources to maintain good relations with China and India. To make sure that enough of Canada’s energy resources flowed south rather that west, the US fostered many joint endeavors with Canada to develop technological breakthroughs for stretching the amount of oil extracted from any one well, conservation techniques that improve efficiency, cleaner uses of coal, and conversion of bitumen to synthetic crude oil with measures for carbon dioxide capture and storage. With an all but dead environmental movement, even the development of shale oil is now pursued.

North American R&D funding has tripled and some progress has been made in the development of solar cells, water-energy efficient agriculture, and new organisms that use life processes to produce crops that can be converted to fuels. There is also some experimentation with “synthetic” organisms that will permit the extraction of residual petroleum from wells previously thought to be depleted. The development of large-scale portable generators by the U.S. military has led to an acceleration of diffusion of points of generation. Military technology also provided new kinds of batteries for a range of battery-powered devices, including the electric car. These batteries have now become a major North American export.

Other investments focused on high-efficiency water purification processes, in the hope that the region might at some future time export water in trade deals for oil. The R&D program also concentrated on the development of new catalysts to lower the energy requirements of electrolysis, a step toward a hydrogen economy. Some Arab countries have also been investing in similar water technologies, taking advantage of their oil profits and worrying about the future of their own water supplies.

Brazil and much of Latin America have become primary exporters of ethanol, and researchers in North America are attempting to design a crop and process that will improve the output of alcohol. If this work is successful, not only will these countries have a new fuel or fuel additive, but these investors are hoping that they may be able to export some of this product in competition with Brazil. India followed China in entering this biotechnology race for new energy sources. European environmentalists have blocked the use of genetically modified organisms that can create new energy supplies, arguing about the consequences if the synthetic organisms escape and evolve in nature. Nevertheless, the long-term future stability of energy supply could well come from the merger of natural and artificial systems.

* * * *

Efforts to create serious international governance structures that require compromise and give-and-take negotiations have largely failed over the past 20 years. Ethnic groups and countries are looking out for their own interests. The global economy has not yet grown back to its pre-2011 size. Many have turned inward, focusing more on local affairs and with increasing reliance on religion for security. Some believe humanity is in a time of religious revival. It is unfortunate that the international community ignored for so long the grievances of radical Muslims living in regions of oil supply.

An electronic iron curtain has come down between the knowledge-able and the knowledge-less. The decay of family and social values, corruption, and transnational crime seem to have become the governing elements in the system. Many people have withdrawn into the personal, private, cyberspace world. Not enough seem to care about the environment or their neighbors. One wonders if the world has entered a new kind of World War III.


Comparative Analysis of the Scenarios

The International Futures models were used for additional quantitative scenario data. The models were produced for the UNEP GEO Project and for the National Intelligence Council, 2020 Project.

Characteristics of the Millennium Project scenarios were used to estimate exogenous energy efficiency. Existing IFs scenarios were used where possible. The models were run computing five output variables:
• Annual emissions from fossil fuels— billion tons
• Energy demand—billion barrels of oil equivalent
• Energy price—index, base 100 in 2000
• GDP per capita in PPP 1995 dollars—thousand dollars
• Annual water usage—cubic kilometers

Figures 15–19 illustrate the comparison between the four Global Energy Scenarios 2020 using the IF Model.

Figure 15. Energy Demand (bill. barrels OE)


Figure 16. Annual Emissions from Fossil Fuels (bill tons)

Figure 17. Energy Prices (2000=100)

Figure 18. Annual Water Use (cubic KM)

Figure 19. GDP per Capita (PPP 95$)


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