Brittle Power- PARTS 1-3 (+Notes) - Natural Capitalism Solutions

Chapter Fourteen: Rethinking the Energy System 221justification than a mere appeal to custom. After all, most of the devices in ourdaily lives use energy at a rate ranging from watts to thousands of watts. (Forcomparison, the metabolism of the human body uses somewhat over a hundredwatts.) The average heating or cooling load of an inefficient house is typicallythousands of watts. Large buildings, and the devices used in most majorprocesses of industrial production, use of the order of hundreds of thousandsof watts. Most factories or office buildings use a total of no more than somemillions of watts, or in a very few cases a few billion watts.Yet the scale of modern power plants, refineries, proposed synfuel plants,and the like is routinely at or above the highest end of this scale—that is, of theorder of billions or tens of billions of watts. Why is it that these energy-supplyingtechnologies are thousands, millions, or more times as large as their typicalcustomers? Does this enormous mismatch of scales actually save money?A few years ago, it was heretical even to ask this question, let alone to suggestthe answer to which dispassionate analysis seemed inexorably to lead:that many of the advantages claimed for large scale in energy systems may beillusory because they are outweighed by less tangible and less quantifiable butperhaps more important disadvantages and diseconomies. 8 Today, however,both question and answer are rapidly becoming more respectable and urgent.The habit of assuming that bigger is always cheaper is still strong, of course.Much of the electric utility industry continues to spend tens of billions of dollarsper year building gigantic power plants on this assumption. Furthermore,official studies have observed almost a taboo again testing the assumption withempirical data. Even when the Public Utility Regulatory Policies Act of 1978mandated that the government assess “the cost effectiveness of small versuslarge [electrical] generation, centralized versus decentralized generation, andintermittent generation, to achieve desired levels of reliability,” 9 the EconomicRegulatory Administration, the agency charged with this study, virtuallyignored the call. 10 So did other government studies which were supposed to concernthemselves with exactly this problem. 11 Nonetheless, enough evidence isnow available to cast the most serious doubt on doctrinaire assumptions that theenergy system still has economies of scale available for exploitation.This does not mean that decisions to build large plants in the past werealways irrational. Rather, it means that, taking all relevant economic factorsinto account, such decisions would no longer be cost-effective in today’saltered circumstances. Nor does it deny that big projects may have realeconomies of scale in construction cost per kilowatt of installed capacity. But wherethis economy of scale exists, it is a gross, not a net, effect. It must be temperedby other effects which may, for example, make each installed kilowatt of thatcapacity send out or deliver less energy than at smaller scale. Other tempering