Isn’t it Time to Examine the Real Cost of Energy Production?

06/07/2022

By Michael W. Wright and David Jimenez

If you could go back in time, would you have chosen fossil fuels as the energy source for the 20th century?

Wouldn’t you have liked to look at the actual lifetime costs to the planet and, by proxy, to the economy?

In some industries, the models to examine the costs of technology choices have changed the course of industry decision making.

We are at a similar cusp, our choices for sustainable energy sources are at hand.

Today, humankind must make decisions about adopting technologies whose impact on people and planet are unforeseeable without careful consideration. Due to the complexity and high adoption rates (exponential) of modern technologies, decision making has become fraught with serious challenges. In fact, due to the complex interactions and systems integration of multiple technologies, the ramifications of our technology decisions are no longer obvious.

We engage in accelerating technologies from innovation to ubiquitous adoption with little examination of the consequences.

And once embedded in our infrastructures, transitions and transformations are not possible without large human costs.

Examples are the impacts of unintended human, economic, and environmental consequences our science and technology choices create. From our sources of energy generation affecting climate change, to low-cost mundane products creating oceans of plastic, our technology choices demand rigorous examination, using proven techniques from leading edge industries and institutions.

When examining the cost of energy production, we must look at total lifetime costs.

Lifetime issues to consider:

  • Extraction (exploration, drilling, mining)
  • Refining, Conversion, Manufacturing
  • Installation (land, water use)
  • Operating costs over the operational life
  • Decommissioning costs (waste disposal, waste storage, recycling, carbon sequestration)
  • Environmental (sustainability, regeneration, carbon containment, etc.)

While most of the above is known for fossil fuels, traditional renewables (e.g., photovoltaics, wind turbines, solar thermal, nuclear, hydrogen) also have issues.

The terms “green or clean energy” applied to these typical renewables is not an accurate picture of their full lifecycle costs. We need to rigorously examine the total direct and indirect costs to produce a kw of energy, from raw materials to conversion to lifetime cost.  If we don’t, we will create the next generation of inextricable costs and existential consequences.

We propose that a study by industry and policy makers is needed to look at what different approaches to energy generation really cost our societies long-term across all non-fossil fuel energy technologies.

To say an EV is a zero-emission vehicle is not at all valid. Batteries do not make electricity, they store electricity produced elsewhere, primarily from coal, uranium, natural gas-powered plants, or diesel-fueled generators. Forty percent of the electricity generated in the U.S. is from coal-fired plants, it follows that forty percent of the EVs on the road are coal-powered.

If you’re excited about electric cars and a green revolution, we suggest you encourage leadership to take a much closer look at the total cost of batteries, windmills, photovoltaics, etc. As an example, a typical EV battery weighs 1,000 pounds. It contains 25 pounds of lithium, 60 pounds of nickel, 44 pounds of manganese, 30 pounds cobalt, 200 pounds of copper, and 400 pounds of aluminum, steel, and plastic.

To manufacture each EV auto battery, you must process 25,000 pounds of brine for the lithium, 30,000 pounds of ore for the cobalt, 5,000 pounds of ore for the nickel, and 25,000 pounds of ore for copper. We dig up 500,000 pounds of the earth’s crust for one battery, and that translates into untold costs in time and money to barely restore the ground.

The problem with solar arrays is the chemicals needed to process silicate into the silicon panels. To make silicon pure enough for solar applications requires processing it with hydrochloric acid, sulfuric acid, nitric acid, hydrogen fluoride, trichloroethane, and acetone. In addition, they also need gallium, arsenide, copper-indium-gallium-di-selenide, and cadmium-telluride, which are ALL highly toxic. Silicon dust is a hazard to the workers and the panels are difficult to recycle in an energy efficient manner, plus landfill is not a free disposal cost.

Windmills are the ultimate in embedded costs and environmental destruction. The average unit weighs 1,688 tons (the equivalent of 23 houses) and contains 1,300 tons of concrete, 295 tons of steel, 48 tons of iron, 24 tons of fiberglass, and the hard to extract rare earths neodymium, praseodymium, and dysprosium. Each blade weighs 81,000 pounds and will last 15 to 20 years, at which time it must be replaced. We cannot recycle used windmill blades.

Next generation nuclear power promises to deliver smaller, more efficient, and safer clean power. The promise of less hazardous waste, smaller footprint, and a wide range of generating capabilities from 1 MWe to 5 MWe to 300 MWe, depending on application, still incurs the costs of security and waste disposal, though there are companies now examining using spent nuclear material to create batteries. The micro-nuclear technologies being developed do, however, provide on demand power many years longer than solar or wind. This clean energy approach, which reduces materials impacts, is increasing in relevance.

There may be a place for all technologies, but leadership must look beyond the myth of zero emissions at point of generation to total emissions and unaccounted costs in the supply, support, and maintenance chains.

 “Going Green” may sound like the Utopian ideal; however, when you look at the hidden costs realistically with a view toward the horizon, which grows closer at an exponential rate, you can see that adoption at scale without considering total costs will add to our shared planet’s existential challenges.

We’re not opposed to mining, electric vehicles, nuclear, wind, solar or other technologies, but empirically knowing how our choices ramify across the environment, economies, geopolitics, and the individual pocketbook would be a prudent step to take before implementing nearly irreversible energy sourcing policies and funding decisions.

The purpose of a non-partisan funded analysis would be to provide leadership with multiple industry tested tools for taking a closer and longer-term view looking around the corner before spending.

Humanity deserves the closer look.

Michael W. Wright is a former high technology Chairman/CEO/COO at scale and a founder of WWK.com. He is currently a Board/C-suite advisor at Intercepting Horizons, LLC, and a professional board member.

David Jimenez is president and CEO of Wright Williams & Kelly, Inc., the largest privately-held operational cost management software and consulting services company.