David Fuchs

This conversation is closed.

Is solving the world energy problems at $10 per Mwh a moral issue?

If you know you will destroy governments reliant on fossil fuels for funding, cause the failure of nations, destroy most pension systems due to their reliance on carbon investments, cause deflationary pressure on every nation worldwide, and cause people to lose their life savings.

Would you release the technology to do $10-$20 per Mwh energy?
Is it morally right with the damage it will do?

>>>> Reply to all. This issue is closed. The next issue is a question as to if this is actually a device that can do sub $20 per Mwh energy.

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    Nov 22 2012: I found this chart on Wikipedia. The costs per Mwh make your $10 figure look like science fiction. Is your question more about morality than science?
    "California levelized energy costs for different generation technologies in US dollars per megawatt hour (2007) Technology Cost (USD/MWh)
    Advanced Nuclear 67
    Coal 74–88
    Gas 87–346
    Geothermal 67
    Hydro power 48–86
    Wind power 60
    Solar 116–312
    Biomass 47–117
    Fuel Cell 86–111
    Wave Power 611
  • Nov 20 2012: I agree completely with Krisztian, that your concerns are baseless.

    IMO, it is a moral issue, but for exactly the opposite reasons. The benefits of cheap energy, to the poorest of the world, would be enormous. So Yes, we have a moral obligation to pursue sustainable cheap energy.
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      Nov 20 2012: Edited the above question and added "cause deflationary pressure on every nation worldwide"

      A sizable portion of the costs of all goods, manufactured and grown is energy. The energy costs for "things" go from 20% to 80% depending on how many levels of manufacturing, shipping, refrigeration, and number of employees that are involved. Removing or reducing the cost of energy by 90% would cause a huge worldwide deflationary economic event.

      Throwing in the failure of every nation running a deficit, is it still morally right to release this technology?
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        Nov 20 2012: so the price of some goods go down, and we should be worry about it? why? how is it not a good thing? and don't hide behind buzzwords like "deflation". what is the actual danger of something getting cheaper?
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          Nov 20 2012: You do not seem to see it, it is not just a few items, the cost of ALL GOODS would go down. Leading to reduced salaries, cause reduced tax revenues for governments. In a way lead to a basic doubling of the debt for every nation as their tax revenues are permanently reduced as salaries go down.

          Perhaps I should have asked if it was ethical rather than moral.
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        Nov 20 2012: i'm afraid i understand the issue quite well. but i want you to think about it in some depth.

        let's say the price of everything goes down. why would that matter? even if tax revenue goes down, it hurts nobody, since everything is cheaper. the smaller sum of money still buys you more than previously. so where is the problem exactly?
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          Nov 20 2012: I have thought about this in depth, from the perspective of an age of abundance. I see no way to get around all the chaos, financial hardship, and business failures that are going to occur when energy costs are reduced this much.

          Take existing home sales -vs- new home sales. When you have a substantial reduction in the cost of manufactured goods, nails, lumber, wire, plumbing, etc lets call it a 40% reduction in cost. Existing home prices will be way outside what the market will bear when a new house, almost twice the size, can be bought at the same price.

          Writing that I realized something very simple. This will not be an instantaneous reduction in the cost of energy, it will occur over several years allowing markets to adapt. So I guess you are right. There really is no problem with energy at $10 per Mwh.
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        Nov 21 2012: the gradual nature of any such change is a valid point. but even if happened overnight, it still would not lead to massive "economy-quake". what would happen is just a large does of "creative destruction", which means that certainly, some businesses will abruptly end as the new ones take their places. and this spreads to other areas as well. if we don't need coal mines, the miners are laid off, truck sales will fall, and so on. but everything becomes more available and more affordable, so these people can find other jobs. also the owners of such companies, including small savers, can be hurt. but it is normal. owning something does not guarantee future value. the marketplace always changes rapidly. if you want your wealth preserved, you need to hedge. everyone else not affected directly is better off. it does not matter how price of things change in money terms. nobody cares about the numbers written on price tags. we care about relative prices, compared to, say, one work hour of ours.
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          Nov 22 2012: In an idealized system that is the correct response. Every thing will work out. But we do not live in an ideal society. We live in a society that supports the currently entrenched.
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        Nov 22 2012: this is a stock answer that requires further elaboration. every society is reluctant to change. change has a cost, monetary as well as psychological. and societies take that cost into consideration. it represents a sort of "friction" that slows changes down. but it does not stop societies to change when it is needed. it happened for many thousands of years, and i see no reason why would it not work for a sudden increase in the availability of energy.
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          Nov 23 2012: A sudden increase over a several years is one thing. What I pictured was an overnight change in the cost of energy. Any technology takes time to implement. Looking at the numbers, the worst case gives people years to respond to decreasing energy costs. So morality does not come into the equation as this will not be a destructive event.

          The question has been answered, I will be closing this question in a day or two.
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    Nov 20 2012: the implied relationship does not exist. theoretical question: if i open a restaurant next to yours, do i destroy your income? do i shrink your customer base?
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    Nov 25 2012: If we manage somehow to rise to the environmental challenge and to trancide from our energy guzzling dinosaur society to an energy conserving society of the future, there will of course be different kinds of collateral damage.

    In the long run, the transition would benefit everyone as much as it would harm them. Why should we a priori accept that our whole financial system is subseviant to obsolete comodities?

    In your hypothetical question you didn't stipulate whether the new cheap energy was environmentally sustainable or not. In the event it is, the benefits would far outweigh the detriments.
  • Nov 24 2012: I don't think the problems you described would occur with cheaper energy. Cheap energy would free up more resources for other endeavors, which would make up for any industries that were hurt.

    More to the point: It is better to do things responsibly and efficiently. If doing so hurts the viability of a less efficient or responsible method, then so be it..
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      Nov 26 2012: Thank you I came to the same conclusion.
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    Nov 23 2012: "I agree with you, but the raw fuel might also be a commodity."

    How would that work out exactly. Taxing sunlight?
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    Nov 23 2012: I know the LCoE or LEC chart very well.


    The cost of energy is, the energy produced divided by the total cost to produce the energy over a given period of time. That includes the fuel, the factory costs, and the taxes and labor.

    So my question to you is. Does a device that costs $2,500 installed that produces 3.5 kwh 24 hours x 7 days a week for 25 years equate to under $20 per Mwh?
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    Nov 22 2012: "I think energy is a commodity that should be controlled by world markets."

    Actually, energy should no longer be the commodity, energy production should be the commodity.
    • Nov 22 2012: I agree with you, but the raw fuel might also be a commodity.
  • Nov 22 2012: Yes, Yes.
    Is it morally right for those with fossil fuels to set prices that countries with no fossil fuels can not afford to pay?
    I think it is a business decision.
    Is there an assumption that all countries will have access to this $10/MW technology or resource?
    Is it morally right for those with fossil fuels to buy the technology and then sit on it until the fossil fuels are gone?
    I think energy is a commodity that should be controlled by world markets.
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    Nov 21 2012: The change would not be instantaneous. Governments and markets would have some time to adjust, and to the extent that they can't, the good done for the world at large would far outweigh the harm done to some. Your question reminds me of those who decried the fate of professional water carriers once indoor plumbing became common. Or those who have feared for forty years that automation would cause runaway unemployment. The world adjusts to the improvement.
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      Nov 21 2012: Lawren, my whole problem was I was thinking about this from the perspective of an instantaneous transition not a slow and gradual implementation. My conversation with Krisztián Pintér made me realize the error in my logic.

      "decried the fate of professional water carriers once indoor plumbing became common", is almost as bad as the "Buggy whips" and "candle maker" lines used about automobiles and light bulbs.