Hidden Costs of Energy : Unpriced Consequences of Energy Production and Use

by Committee on Health Environmental and Ot

• ISBN13: 9780309146401
• ISBN10: 0309146402
• Format: Paperback
• Copyright: 2010-07-30
• Publisher: Natl Academy Pr

Summary

Despite the many benefits of energy, most of which are reflected in energy market prices, the production, distribution, and use of energy causes negative effects. Many of these negative effects are not reflected in energy market prices. When market failures like this occur, there may be a case for government interventions in the form of regulations, taxes, fees, tradable permits, or other instruments that will motivate recognition of these external or hidden costs. The Hidden Costs of Energydefines and evaluates key external costs and benefits that are associated with the production, distribution, and use of energy, but are not reflected in market prices. The damage estimates presented are substantial and reflect damages from air pollution associated with electricity generation, motor vehicle transportation, and heat generation. The book also considers other effects not quantified in dollar amounts, such as damages from climate change, effects of some air pollutants such as mercury, and risks to national security. While not a comprehensive guide to policy, this analysis indicates that major initiatives to further reduce other emissions, improve energy efficiency, or shift to a cleaner electricity generating mix could substantially reduce the damages of external effects. A first step in minimizing the adverse consequences of new energy technologies is to better understand these external effects and damages. The Hidden Costs of Energywill therefore be a vital informational tool for government policy makers, scientists, and economists in even the earliest stages of research and development on energy technologies.

Table of Contents

Summary	p. 3
Introduction	p. 22
Genesis of the Study	p. 22
Statement of Task	p. 23
Related Studies	p. 25
Defining and Measuring Externalities	p. 29
Selecting Energy Sources and Uses for This Study	p. 36
Framework for Evaluating External Effects	p. 43
The Policy Context for This Study	p. 54
Some Methodological Issues: Space, Time, and Uncertainty	p. 57
Organization of the Report	p. 63
Energy For Electricity	p. 64
Background	p. 64
Electricity Production from Coal	p. 71
Electricity Production from Natural Gas	p. 109
Electricity Production from Nuclear Power	p. 125
Electricity Production from Wind	p. 136
Electricity Production from Solar Power	p. 142
Electricity Production from Biomass	p. 145
Transmission and Distribution of Electricity	p. 147
Summary	p. 148
Energy For Transportation	p. 154
Background	p. 154
Approach to Analyzing Effects and Externalities of Transportation Energy Use	p. 157
Production and Use of Petroleum-Based Fuels	p. 165
Production and Use of Biofuels	p. 181
Electric Vehicles	p. 197
Natural Gas	p. 204
Hydrogen Fuel-Cell Vehicles	p. 207
Summary and Conclusions	p. 209
Energy For Heat	p. 222
Background	p. 222
Heat in Residential and Commercial Buildings	p. 226
Heat in the Industrial Sector	p. 228
Estimates of Externalities Associated with Energy Use for Heat	p. 232
Emissions of Greenhouse Gases	p. 240
Potential Damages Reductions in 2030	p. 241
Summary	p. 246
Climate Change	p. 248
Overview of Quantifying and Valuing Climate-Change Impacts	p. 248
Impacts on Physical and Biological Systems	p. 261
Impacts on Human Systems	p. 266
Economic Damage from Irreversible and Abrupt Climate Change	p. 289
Aggregate Impacts of Climate Change	p. 294
Marginal Impacts of Greenhouse Gas Emissions	p. 300
Research Recommendations	p. 308
Infrastructure and Security	p. 309
Introduction	p. 309
Disruption Externalities in the Electricity-Transmission Grid	p. 309
Facility Vulnerability to Accidents and Attacks	p. 316
External Costs of Oil Consumption	p. 325
Security of Energy Supply	p. 330
National Security Externalities	p. 331
Conclusion	p. 336
Overall Conclusions and Recommendations	p. 337
The Committee's Analyses	p. 337
Limitations in the Analyses	p. 338
Electricity Generation	p. 339
Transportation	p. 348
Heat Generation	p. 356
Climate Change	p. 358
Comparing Climate and Nonclimate Damage Estimates	p. 360
Overall Conclusions and Implications	p. 362
Research Recommendations	p. 367
References	p. 372
Abbreviations	p. 400
Common units and Conversions	p. 405
Appendixes
Biographic Information on the Committee on Health, Environmental, and Other External Costs and Benefits of Energy Production and Consumption	p. 411
A Simple Diagrammatic Example of an Externality	p. 420
Description of Apeep Model and Its Application	p. 423
Description of Greet and Mobile6 Models and Their Applications	p. 432
Supplemental Information on Land-Use Externalities From Biofuels: A Case Study of the Boone River Watershed	p. 470
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