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Iraq War Could Have Paid For 100% Renewable Power Grid

Posted By Washingtons Blog On April 14, 2013 @ 3:30 am In Energy,Think Tank,War/Defense | Comments Disabled

For the Price of the Iraq War, The U.S. Could Have a 100% Renewable Power System

Posted on April 11, 2013 [1] by WashingtonsBlog [2]

What Are We Choosing for Our Future?

Wind energy expert [3] Paul Gipe reported [4] this week that – for the amount spent on the Iraq war – the U.S. could be generating 40%-60% of its electricity with renewable energy:

Disregarding the human cost, and disregarding our “other” war in Afghanistan, how much renewable energy could we have built with the money we spent? How far along the road toward the renewable energy transition could we have traveled?

The answer: shockingly far.

Cost of the Iraq War

The war in Iraq has cost $1.7 trillion through fiscal year 2013 [5], according to Brown University’s Watson Institute for International Studies [6]. That’s trillion, with a “t”. Including future costs for veteran’s care, and so on, raises the cost to $2.2 trillion.

Because the war was financed with debt, we should also include a charge for interest on the debt. The Iraq war’s share of cumulative interest on the US debt through 2053 will raise the total cost of the war to $3.9 trillion.

To weigh what opportunities we lost, we’ll consider two conditions: the direct cost, and the direct cost plus interest.

Renewable Energy Assumptions

*** For this evaluation, I will use a mix of wind and solar.

Why a mix? Because if we want to develop an integrated system that will replace the mix of fossil fuels and nuclear power we use today, we will need a mix of renewable resources as well. Ideally, we would develop our wind, solar, geothermal, and biomass resources simultaneously. However, it is wind and solar that will provide the bulk of new generating capacity. So I’ve simplified this analysis by only considering a mix of wind and solar.

***

While the cost of solar has declined dramatically, it remains far more expensive than wind generation. Including solar as part of a mix of resources reduces the effective penetration of renewables, but is more realistic and, hence, more conservative than simply estimating how much wind could have been built.

***

Robert Freehling, a renewables consultant in California, has pointed out that these assumptions are much too conservative.

Wind Yield

***

Today, yields can range from less than 2,000 kWh per kW for inland locations like those in Germany, to more than 2,500 kWh per kW for windy locales like those in Ireland and Great Britain.

***

Freehling suggests 2,250 kWh per kW is a more representative yield.

Solar Yield & Cost

Solar yields in Germany vary from a low of 900 kWh per kW of DC capacity in the north to nearly 1,100 kWh per kW in the south.

Similarly, yields in the US vary widely from 1,000 kWh per kW in rainy Seattle to 1,800 kWh per kW in the blistering sun of the desert Southwest. Freehling believes a more representative yield for the US market is 1,200 kWh per kW.

Solar costs continue to plummet. If the US market ever becomes as competitive as the German market, we can expect that average installed cost of ground mounted and roof-mounted systems across the country will fall far below the $5,000 per kW I’ve assumed. Freehling suggests that the cost for a representative cross-section of installation types over the next decade is $3,350 per kW of DC capacity.

What We Lost in Renewable Opportunities

Based on a conservative estimate, the US could have built between a quarter-million to nearly a half-million megawatts of wind energy, and 300,000 to 600,000 megawatts of solar capacity.

For comparison, today there are only 60,000 MW of wind in the US, and a paltry 7,000 MW of solar.

If we had invested the $2.2 trillion in wind and solar, the US would be generating 21% of its electricity with renewable energy. If we had invested the $3.9 trillion that the war in Iraq will ultimately cost, we would generate nearly 40% of our electricity with new renewables. Combined with the 10% of supply from existing hydroelectricity, the US could have surpassed 50% of total renewables in supply.

However, this is a conservative estimate. If we include the reasonable assumptions suggested by Robert Freehling, the contribution by renewables would be even greater.

Freehling’s assumptions raise to as much as 60% the nation’s lost potential contribution by new renewables to US electricity supply by going to war in Iraq. With the addition of existing hydroelectric generation, the opportunity to develop as much as 70% of our nation’s electricity with renewable energy was lost.

And unlike the war in Iraq, which is an expense, the development of renewable energy instead of war would have been an investment in infrastructure at home that would have paid dividends to American citizens for decades to come.

But Nobel prize winning economist Joseph Stiglitz estimated in 2008 that the Iraq war could cost America up to $5 trillion dollars [7].

And the Brown University study actually concluded that the Iraq war could end up costing $6 trillion dollars [8] over the next 40 years.

Since $6 trillion is one and a half times as much as the $3.9 trillion estimate used by Gipe and Freehling, that means that the Iraq war money could essentially convert 100% of U.S. power to renewable energy.

True, comparing future interest payments to present renewable energy costs may be comparing apples and oranges.

But given that the nation’s top energy experts point out stunning breakthroughs in energy production, distribution, storage and conservation will drastically lower the costs of alternative energy, that $5-6 trillion could perhaps fund 100% renewable energy production:

~~~

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And see this [9], this [10], this [11] and this [12].

Moreover, given that war is very harmful for the economy [13], the costs of the Iraq war including the drag on the economy raises the price tag well above $6 trillion. So 100% of renewable energy funding may be realistic.

It is ironic, indeed, that the Iraq war was largely about oil [14]. When we choose subsidies for conventional energy sources – war or otherwise – we sell our future down the river.


Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2013/04/iraq-war-could-have-paid-for-100-renewable-power-grid/

URLs in this post:

[1] April 11, 2013: http://www.washingtonsblog.com/2013/04/for-the-price-of-the-iraq-war-the-u-s-could-have-a-100-renewable-power-system.html

[2] WashingtonsBlog: http://www.washingtonsblog.com/author/washingtonsblog

[3] expert: http://www.wind-works.org/cms/index.php?id=26

[4] reported: http://www.wind-works.org/cms/index.php?id=496&tx_ttnews[tt_news]=2319&cHash=1af0d1c40ad89f3c76d47128ec3ade01

[5] $1.7 trillion through fiscal year 2013: http://costsofwar.org/sites/all/themes/costsofwar/images/US_Budgetary_Costs_of_the_Iraq_War%5B2%5D.pdf

[6] Brown University’s Watson Institute for International Studies: http://costsofwar.org/

[7] $5 trillion dollars: http://www.bloomberg.com/apps/news?pid=newsarchive&sid=acXcm.yk56Ko

[8] $6 trillion dollars: http://www.latimes.com/business/money/la-fi-mo-iraq-war-cost-20130318,0,1591279.story

[9] this: http://www.eurekalert.org/pub_releases/2013-04/vt-bih040313.php

[10] this: http://www.technologyreview.com/view/512996/a-cheaper-way-to-make-hydrogen-from-water/

[11] this: http://www.washingtonsblog.com/2010/05/is-it-true-that-alternative-energy-is-too-expensive.html

[12] this: http://www.washingtonsblog.com/2011/04/its-not-just-alternative-energy-versus-fossil-fuels-or-nuclear-energy-has-to-become-decentralized.html

[13] war is very harmful for the economy: http://www.washingtonsblog.com/2012/02/debunking-the-myth-that-war-is-good-for-the-economy-once-and-for-all.html

[14] largely about oil: http://www.washingtonsblog.com/2013/03/top-republican-leaders-say-iraq-war-was-really-for-oil.html

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