Placing energy, or the lack thereof, at the core of “virtually every problem facing humanity,” Richard E. Smalley, director of the Carbon Nanotechnology Laboratory at Rice University, said the country should be skeptical of the existing energy industry’s optimism that it can find a solution to the energy prosperity dilemma.

“We cannot afford to get this wrong,” Smalley testified at an oversight hearing Tuesday on sustainable, low-emission electricity generation before the Senate Committee on Energy and Natural Resources.

“We are heading into a new energy world. With economic recovery in the countries of the OECD [Organization for Economic Cooperation and Development] and rapid development of China and soon India, huge new demands will be placed on the world oil and gas industry,” he said. “Yet oil production will probably peak worldwide sometime within this decade, and the future capacity of natural gas production is unclear. Coal will be able to pick up some of the slack, but with current technology this will amplify the threat of massive climate change.”

Smalley said the United States must find the basis for energy prosperity domestically, as well as for the rest of humanity in the 21st century. He noted that by the middle of this century it should be assumed that mankind will need to at least double world energy production from its current level, with most of this coming from some clean, sustainable, CO2-free source.

“For worldwide peace and prosperity it needs to be cheap,” he added. “We simply cannot do this with current technology. We will need revolutionary breakthroughs to even get close.”

Pointing out that oil was the principal driver of the country’s economic prosperity in the 20th century, Smalley said, “It is possible that Mother Nature has played a great trick on us, and we will never find another energy source that is as cheap and wonderful as oil. If so, this new century is certain to be very unpleasant.”

Despite the overwhelming task at hand, Smalley said he believes that the “New Oil” can be found through new technology that provides the massive clean energy necessary for advanced civilization. “With luck we’ll find this soon enough to avoid the terrorism, war and human misery that will otherwise ensue.”

At the base root of the equation, Smalley said, electricity is the key. “By 2050 we will do best if we do this transportation of energy not as oil, or coal, or natural gas, or even hydrogen,” he said. “We should not be transmitting energy as mass at all. Instead we should transport energy as pure energy itself.”

As an example, Smalley asked the Senate committee to envision a vast interconnected electrical energy grid for the North American continent from above the Arctic Circle to below the Panama Canal. “By 2050 this grid will interconnect several hundred million local sites,” he said. “There are two key aspects of this future grid that will make a huge difference: (1) massive long-distance electrical power transmission, and (2) local storage of electrical power with real-time pricing.”

Calling the storage of electrical power “critical” for the stability and robustness of the electrical power grid, Smalley said that the most efficient place to do the storing is locally. Smalley envisioned a future where by 2050, every house, every business and every building has its own local electrical energy storage device, an uninterruptible power supply capable of handling the entire needs of the owner for 24 hours. He noted that since these storage devices will be small and inexpensive, the owners can replace them with new models every five years or so, while new technology continues to create a better wheel.

“With intense research and entrepreneurial effort, many schemes are likely to be developed over the years to supply this local energy storage market that may expand to several billion units worldwide,” he said. “With these advances, the electrical grid can become exceedingly robust, since local storage protects customers from power fluctuations and outages.”

With real-time pricing in place, Smalley testified that the local customers would have incentive to take power from the grid when it is cheapest, which in turn permits the primary electrical energy providers to deliver their power to the grid when it is most efficient for them to do so, and vastly reduce the requirements for reserve capacity to follow peaks in demand. Smalley said the most important aspect of the plan is that it permits a large portion — or even all — of the primary electrical power on the grid to come from solar and wind.

In addition to storage answers, Smalley said the other critical innovation needed is massive electrical power transmission over continental distances, “permitting, for example, hundreds of gigawatts of electrical power to be transported from solar farms in New Mexico to markets in New England.” If this was achieved, all primary power producers could compete with little concern for the actual distance to market. Under this scenario, “Everybody plays,” he said.

Smalley said these much-needed innovations will come from “miraculous discoveries” in science together with free enterprise in open competition for huge worldwide markets. He told the Senate committee that the U.S. should launch a bold new energy research program, funded by a nickel tax for every gallon of gasoline, diesel, fuel oil and jet fuel, which would generate $10 billion a year. After five years he suggests that the tax be raised to a dime per gallon to increase the fund.

“Sustained year after year, this New Energy Research Program will inspire a new Sputnik Generation of American scientists and engineers,” Smalley said. “At minimum it will generate a cornucopia of new technologies that will drive wealth and job creation in our country. At best we will solve the energy problem within this next generation; solve it for ourselves and, by example, solve it for the rest of humanity on this planet.”

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