The Jackson Hole Global Forum Interview Series share the energy, business and expertise that will be shared at the upcoming Jackson Hole Global Forum (www.jhcga.org/globalforum), to be held on Nov 8-9, in Jackson Hole.
The Forum will bring together diverse experts to discuss and compare the current challenges and potential opportunities for U.S. coal communities and similar regions around the world to generate new models of economic growth. The forum will focus on the particular challenges faced by carbon-intensive areas. It will help provide the global context, new ideas, and new partnerships for communities, businesses, policymakers and concerned citizens in Wyoming and beyond. Register to attend here.
Q - Background: Tell us a little about your background, particularly if/as it relates to energy and economics related to coal communities or elsewhere?
Kate: I’m an independent consultant and work with the Paulson Institute, which looks at the relationship between the U.S. and China on key issues such as sustainability. Obviously, coal use is a big issue in China where they’re going through their own industrial revolution in some ways. I also do work with a number of other organizations, many of which are looking at this general question of how do we do this energy and economic transition in a way that’s sustainable and that also creates economic prosperity. That’s the essential focus of my work. I have degrees in law and urban planning and my focus on energy has always been from the perspective of energy as an economic growth strategy.
Q- Coal’s Future: As it relates to global energy trends in 2018, over the next ten years, do you see demand for coal increasing, decreasing, or staying the same?
Kate: It’s a good question, I think energy demand is certainly increasing, so let me separate these things out. Energy demand is potentially increasing in the U.S., due to some technology trends, like credit currency and blockchain and frankly, marijuana legalization. Globally, energy demand is increasing – particularly in India, China, South Africa, some of these fast-urbanizing places. Whether people use coal to meet that demand is another question. I think the demand for coal specifically is declining due to a number of factors. Almost every country has committed to reducing carbon emissions and the fact is that we have now more affordable alternatives to coal than we did even 20 years ago. The advent of gas and hydraulic fracturing and gas being found all over the place, in a huge variety of places, has changed the game completely for coal. Renewables coming down in cost is a huge factor too. So I see a lot of increase in energy demand, but a shift in how we meet that demand.
Q - Carbon Capture: Nationally, do you see carbon capture technologies starting to become mobilized at scale in the near future (between 5 and 10 years)? What do you think that time period will look like globally?
Kate: There is a whole suite of carbon removal technology, so carbon dioxide removal is a much bigger category than carbon capture in the way that we normally think about it. We normally think, “Oh, it’s just carbon capture in an industrial plant,” with a coal or gas plant. However, carbon removal’s a much bigger category than that – for example trees are carbon removal, all the way to these people doing interesting technology around direct air capture and getting emissions right out of the atmosphere. CCS or carbon capture sequestration falls in that continuum. I think all those things are ramping up in a big way, in a large part because we know from all the climate science that we have to look at carbon removal as part of the solution given the timelines we’re looking at to get to a livable atmosphere. Also because large parts of the globe are industrializing and we need to figure out how to deal with the carbon emissions from these industrial plants in the near and long term future.
Many people don’t realize that there has actually been bipartisan energy policy on carbon removal in the past year. 45Q is a section of the new tax bill that provides financial incentives for investment in carbon removal, including carbon sequestration and direct air capture. We’re starting to see innovators and investors paying increased attention to this space as a potential growth opportunity. I don’t think for coal that it’s a solution because it’s yet another expensive technology to put on top of a technology that’s losing value, so it doesn’t fix the problem. The bottom line with coal is that there are cheaper things out there and there are alternatives that are available in more places - that’s what going to trump coal use. Putting on a carbon capture piece to a coal plant is not going to fix that problem.
Q - Renewable Energy: Do you think renewable energy opportunities like wind and solar are the leading opportunities that coal communities like Wyoming that are looking for new economic growth should look to?
Kate: That’s a great question. I’m actually writing a book right now that’s about this question, so I have a lot of opinions on it, but I’ll keep it short and say that the book is essentially about fossil fuel in our communities and economic development. I have an economic development background and my answer is that it’s never a good idea to predict ahead of time where some place should go for economic opportunity. You have to look at economic development as a place-based feature and factor that depends on existing geography, assets, and workforce, what kind of transportation infrastructure exists, what kind of core headquartered companies are already there, and what kind of universities and labs are there. All of those things need to be looked at to figure out what the best opportunities are. There’s a great organization called the American Jobs Project, and that’s what they do, they basically kind of say, let’s look at a place and see what the assets are and see what the value proposition is and then figure out what are the best opportunities for that place in the energy transition and sometimes it’s renewables and sometimes it’s not. Sometimes it’s advanced battery storage, sometimes it’s restoration technology, etc. It’s really important to start with where a place is, instead of starting with an idea of what it should be.
Q - Policy: With the Clean Power Plan repealed and the U.S. planning to pull out of the Paris Accord, do you see this slowing progress in carbon capture, renewable energy deployment, and other investments associated with reducing carbon emissions
Kate: Yes and no, I guess. We are one country that pulled out of Paris and repealed the Clean Power Plan, on the international scale there’s a lot more countries that are still in and we are in a global marketplace, so there’s still going to be global pressure. Not only global pressure in stopping certain things, but frankly a lot of opportunity to sell to a global marketplace, so I think it’s important for every state and region to look into what their utilities are and how to take advantage of that. At the same time, many utilities have already gone down the path that the Clean Power Plan was taking them before the repeal, and, in part, because of what I already talked about – gas is cheap and renewables are going to be cheaper - the states are passing their own renewable performance standards. There is a lot of market or state-level policy activity, so I just think the train has left the station and we’ve got to get on that train. I say yes and no because carbon capture’s a little bit harder. It's a really new technology area, kind of like how wind and solar were 15-20 years ago where if you don’t have the right price benefits in place, it can be very hard to develop it quickly. I don’t see us moving very fast on carbon capture, it is a place where we just put in a price policy, but we do need to provide some serious incentive. We did this with coal, we did it with gas, oil, and with renewables, and we need to do it with carbon capture or we’re not going to get those technologies off the ground. I think that would be a real shame because that is a massive market opportunity.
Q - Relevant Templates: Are there other countries, regions, or cities around the globe that you think coal communities can look towards in terms of relevant economic transformation templates?
Kate: That’s a great question, I mean it’s probably because I’ve done a lot of work in China, but I think China’s really interesting. They set very ambitious climate goals at a national level. They’re a very nationalized government, so it matters a lot what they do at a national level. They’re doing that simultaneously with essentially going into an industrial revolution on steroids. They’ve done some interesting things actually with coal communities where the plants have been shut down such as pilots on re-training. They are also looking at alternatives that aren’t just one energy source, but that are a portfolio approach with a bunch of different things that communities can meet demands with. So, we could look to China, and we should look at the economic transition in general, it’s not a new thing, we transition all the time. In the U.S. we did a huge transition when tobacco litigation happened with a lot of tobacco fields, a lot of tobacco growers in North Carolina. We give big workforce development and economic development plans to the regions of the Appalachian regional commission. We should look at those and see what worked and what didn’t work. Look at what Germany and the UK have done with their coal communities, we’ll learn some lessons of what not to do and we’ll learn some lessons of what to do.
To learn more about these global themes and the new climate solutions being mobilized that can positively impact coal communities and harness economic diversification, join us in Jackson Hole from November 8-9, at the Jackson Hole Global Forum: www.jhcga.org/globalforum.