eco:nomics: creating environmental capital

by jeffrey ball

one thing is certain in the race for a cleaner energy system: nothing is going to be certain for quite a long time.

energy secretary steven chu explains to wsj’s robert thomson why it takes so long to approve loans and take other steps needed to move policy toward next-generation energy.

in washington last week, the obama administration abandoned the long-running plan to bury nuclear waste below nevada’s yucca mountain, another potential barrier to new nuclear power plants in the u.s. big questions loom about the viability of electric cars and of futuristic power plants that would shoot their greenhouse-gas emissions underground instead of skyward. and concerns about unintended environmental consequences are thwarting plans for wind and solar farms from wyoming to the mojave desert.

don’t expect clarity from the government, the financial world or even the scientific lab, said the chief executives and entrepreneurs who gathered last week at eco:nomics, the wall street journal’s third annual conference on the business of the environment. but, they advised each other, don’t dally in trying to dominate the new energy market, because the spoils will go to those who exploit the uncertainty the best.

when the journal held the first eco:nomics conference, in march 2008, things seemed clearer. oil prices were high, investors were showering money on renewable-energy developers, and federal lawmakers were pushing to limit emissions of carbon dioxide and other greenhouse gases. the intergovernmental panel on climate change recently had won the nobel peace prize for a report concluding that global warming was “unequivocal” and was “very likely” caused by human activity, so the debate over climate science appeared largely done.

all that has changed. oil prices, though rising again, are just above half their mid-2008 highs. tough economic times are pinching clean-energy investment and prompting new opposition to a mandatory carbon cap. and the ipcc has said it will appoint an independent committee to investigate questions raised recently about its widely watched climate-science reports

“it’s frustrating, but scientists are human beings,” energy secretary steven chu said at the conference. society has produced “a greenhouse-gas layer that is absolutely, positively due to humans,” he said, but the precise impacts remain unclear. “the uncertainties are quite large.”

the uncertainties about what technologies might slash greenhouse-gas emissions remain just as big.

consider just the race for an alternative to the petroleum-powered car. peter voser, ceo of royal dutch shell, predicted that by 2050 electric cars might account for 40% of autos worldwide. t. boone pickens, oilman-turned-energy reformer, said the government should subsidize big trucks that burn natural gas. and craig venter, a self-described “life designer,” is trying to make fuel from newly created organisms that consume co2.

each of these options could become a disruptive technology—something that really rocks the world. it will take years to know. the action playing out amid this uncertainty is today’s real energy shift.

write to jeffrey ball at jeffrey.ball@wsj.com