Ramez Naam and David Roberts go deep on the future of clean energy

The world of climatetech and clean energy is maturing faster than almost anyone thought possible even just a few years ago. But futurist, author and investor Ramez Naam was ahead of his time: He was one of the first to forecast the exponential cost declines of clean energy technologies such as solar, batteries and electric vehicles and to predict that clean energy and transport would become cheaper than fossil-fueled versions. In 2021, he founded the venture capital firm PlanetaryVC to fund startups focused on everything from clean energy to ag tech.

Ramez headlined the recent Canary Live Seattle event, where he had a far-ranging conversation with David Roberts, founder of the Volts podcast and newsletter and editor-at-large at Canary Media. Here’s an excerpt from their in-depth discussion, which touched on hydrogen, ultra-long-distance transmission, the problem with cows, and the potential of space-based solar power. The transcript has been edited for clarity and brevity.

You can also watch the full hour-long conversation, and it will be shared as a future episode of Volts.

The shifting energy mix

David Roberts: As long as there has been solar, there have been people forecasting that it’s going to stop getting cheaper — that the cost is going to plateau — but the reality is that it has just kept going down. Do you think the cost of solar will continue to decrease?

Ramez Naam: Back in 2011, I predicted a tenfold decrease in solar costs by 2050, which happened even faster than expected. Solar and battery technology has evolved from being policy-dependent and expensive to being competitive with and sometimes cheaper than gas and coal.

Looking forward, I think the cost of electricity will drop by another four times by the time solar accounts for about a third of all electricity generation globally. Could this happen twice as fast or half as quickly? Possibly. But the key takeaway is that clean electricity, particularly solar, is becoming increasingly cost-effective.

Solar is the fastest-growing of these technologies, with batteries and wind following. The costs of hydrogen electrolyzers and electric vehicles are also dropping, contributing to the shift toward clean energy. These cost reductions are just the tip of the iceberg, as they don’t consider issues like energy intermittency. However, the trend of decreasing costs is likely to continue. […] Electric vehicles are still in their first phase, being more expensive than gasoline cars. But they’re dropping in price and increasing in scale at twice the pace of solar.

David Roberts: One of the questions about the ​“electrify everything” model is the variability of wind and solar energy. Even with our current battery technology, you can only store four to eight hours’ worth of energy, so we must supplement the remainder with something else. So how much can we rely on electrification? Will the cost reductions and learning curves for these technologies outpace current predictions, meaning we’ll need less supplemental energy than anticipated?

Ramez Naam: Renewable power viability varies greatly with geography. For instance, solar power is cheaper and more feasible in the U.S., which has more sunshine, than in Europe. The scale of the grid also matters — if we built a Chinese-scale grid in the U.S., you would have solar going from New Mexico to New York and wind from the Great Plains going out to the coast. But if we don’t get transmission built, and right now we’re sucking at building transmission in the U.S., then powering New York in winter is actually really hard. I am a firm believer in diversifying our energy toolkit and investing in various technologies including hydrogen, nuclear fusion and fission, transmission grids, and long-duration energy storage, among others.

David Roberts: Right, you advocate an all-inclusive approach, but in your opinion, what is going to play the role of balancing out the grid? 

Ramez Naam: The most underrated technology is ultra-long-distance transmission. This coast-to-coast, continent-scale transmission has the best upside and the most certainty that we can do it, but it’s being blocked not by economics, not by technology, but by permitting, fundamentally.

Clean, firm power like nuclear fission, fusion, geothermal and ultra-deep geothermal also have important roles to play. Ultra-long-duration storage is a wild card; 12-hour storage will be solved, but we may need weeks or months of storage, especially in Europe or the East Coast of the U.S. Offshore wind, particularly floating offshore wind in deep water, is another massively underrated technology. It’s especially relevant for regions like Japan or the U.S. West Coast.

And my absolute wild card that nobody else believes in is space-based solar. It seems expensive, but in space, there are no clouds, so you can get 24/7 solar power, and some models show it getting to like 2 or 3 cents a kilowatt-hour. The cost of space launch is decreasing faster than solar, making space-based solar power a possibility. Despite challenges with transmitting power back to Earth, solar panels in space can generate power continuously, offering a significant advantage. However, practical implementation, including the construction of large arrays in space, remains challenging.

David Roberts: There’s an intriguing tension between those laser-focused on decarbonization, the ​“climate hawks,” and the traditional environmentalists. I worry that many of the people fighting for cutting back environmental review and permitting are not [doing it] out of a genuine concern for the environment but with an aim to further their interests in oil and gas extraction. Do you worry about being on the same side as these bad-faith actors?

Ramez Naam: Those bad-faith actors who are pushing for looser permitting restrictions to facilitate more fossil fuel infrastructure are on the wrong side of history. They’re backing a technology that’s fundamentally going to lose based on cost. So I say let’s make it an open playing field. In an environment where it’s as easy to build pipelines as it is to lay down transmission lines, clean energy will inevitably come out on top. I’m perfectly content with that deal. Bernie Sanders disagrees, for example; he voted against the Schumer-Manchin permitting-reform bill because he’s fundamentally against the construction of new fossil fuel infrastructure. But building more renewables is actually more important than not building fossil fuels, and on a competitive level, renewables win on cost.

David Roberts: But globally, fossil fuels are not declining. We are mostly adding to the total energy load of the world with new renewables. What do you make of the argument that simply building new renewables is not enough, and at some point, we also need to cut off fossil fuel supply?

Ramez Naam: You need to look at leading and trailing indicators. The leading indicator is cost, what’s going to win economically. The next is the pace of deployment increase, then actual deployment. Deployed stocks are a trailing indicator. We might have passed peak fossil fuels in the power sector in 2018. We haven’t yet reduced the internal-combustion-engine car fleet, but sales of gasoline-powered cars likely peaked in 2017 or 2018. All the growth in passenger vehicles is now electric. We probably haven’t peaked total fossil fuels and emissions yet, but that might happen later this decade, toward 2030. It’s not fast enough, but the writing’s on the wall: Fossil fuels are dead men walking. It is a matter of how fast can we pull it off.

The hardest emissions to tackle

David Roberts: Let’s discuss the sectors that are notoriously difficult to decarbonize. So, two questions. One, do you still believe these sectors warrant being called ​“difficult to decarbonize”? And two, which of these sectors do you worry about?

Ramez Naam: Yes, they are. What I’ve been saying mostly pertains to power and ground transport, where we have very fast linear rates of change. But when you add up ground transport and power, they account for maybe 45% of global carbon emissions. The other big contributors are industrial emissions, which are tough to tackle, and we can’t expect the learning rates to be as fast as with renewables. That’s a major problem.

That said, I wrote a piece for TechCrunch back in [2019] where I was really worried about this, and we’ve made more progress faster on industrial emissions than I expected those four or five years ago. Are we moving fast enough? I don’t know, but we’re definitely making progress.

The other major challenge is agriculture, forestry and land use — cows and deforestation, to be precise. It’s not increasing much, but it’s around a quarter of all emissions, rivaling electricity and larger than industrial emissions. Dealing with this is going to require a mix of just pure policy to protect land and finding a way to feed the world’s appetite for meat, which is just going to go up. Forget about reducing meat consumption — ain’t going to happen. Therefore, we need to find ways to reduce the carbon footprint of the meat that people are going to consume [and do it] in a cost-effective way.

So, cows, steel and cement are what keep me up at night more than electricity and cars.

David Roberts: So what is going on with steel?

Ramez Naam: For steel, the most likely solution seems to be power-to-hydrogen. For recycled steel, we use electric furnaces and power them with renewables. But for primary steel, we use coal as a reducing agent. Iron ore has oxygen in it, and we need to strip that oxygen off. We’re currently doing that with coal; you combust the coal to create carbon monoxide, which binds to the oxygen and removes it. But you can use hydrogen for that purpose, and hydrogen seems to be on a trajectory for significant cost reductions.

And that is not the only bet. For instance, Breakthrough Energy Ventures, the venture capital firm, has invested in a company that uses a form of electrolysis to extract pure iron from iron ore, which can then be used to make steel. There are multiple technology pathways for each of these hard-to-abate sectors, but right now, hydrogen looks like the best bet for steel.

David Roberts: Let’s discuss hydrogen for a moment. Hydrogen is the latest trend, and everyone seems to love it. Technically, you can use hydrogen for almost everything if you wanted to. So how big of a role do you envision hydrogen actually playing?

Ramez Naam: It could be enormous. It’s possible that we could build as much generation from renewables to produce green hydrogen as we do for direct power into buildings and electric vehicles.

There are certain areas where hydrogen is not the solution. Hydrogen-powered cars and trucks? Forget about it — it’s been clear for a decade that they’re not going to be cost-competitive. Hydrogen for things like building heat also doesn’t make sense.

Hydrogen in pipelines is the only cost-effective way we know to transport hydrogen today, or using hydrogen to make steel that you then ship around the world, and for high-heat processes, as an ingredient to make electrofuels for ships and planes, whether that’s ammonia or a drop-in kerosene replacement. We’ll likely never see hydrogen-powered planes, but creating a drop-in fuel from hydrogen that you can use in existing Boeing and Airbus planes does eventually make sense. Furthermore, green fertilizer could be a huge market for hydrogen. There is already a $70 billion to $80 billion market for methane-based hydrogen that goes into fertilizers, so that is already a huge market that wants cheap hydrogen.

The big picture

David Roberts: It’s becoming clear that despite all the momentum behind clean energy, we’re unlikely to reach our 1.5-degree target as set by the U.N., at least not just through replacing fossil fuels with clean energy. So it seems important to reflect on what that means. How should we navigate the scenario where the energy world is moving in the right direction but perhaps not fast enough? What do we do about the rising temperatures in the meantime? 

Ramez Naam: To put some numbers around it, when both of us entered this field around 2011, we believed the world was heading for a warming of 5 or 6 degrees Celsius. That’s the temperature difference between now and the last ice age’s midpoint. Such warming is the stuff of nightmares. The good news is that we’ve likely averted that apocalypse. If we examine the developments over the past 24 months, a series of papers suggest that the most probable outcome, given the uncertainties and probabilities in climate science, is now around 2.1 to 2.4 degrees Celsius of warming. This is something to celebrate because such a temperature increase is actually compatible with the overall wealth increase in the world. So we’ve potentially avoided the Day After Tomorrow–type of catastrophe.

But what can we do now? In my view, there are three things we need to do to address climate change. 

First, we need to build more. This includes improving infrastructure, simplifying the permitting process and enacting more policies to facilitate construction.

Second, we need to help nature adapt. Here’s where I might say something a bit provocative: There’s no such thing as true wilderness on planet Earth anymore. We’ve modified the climate to such an extent that natural environments, whether they’re forests, coral reefs or wetlands, don’t exist within the same climatic bands they evolved in. If we want to preserve these ecosystems, we have to actively manage them, even if they’re considered ​“wild.” This applies to everything from rainforests and forests in the Northwest or Canada or the tundra to coral reefs. There’s this naturalistic fallacy that if we just leave nature alone, it’ll be OK. But if we leave nature alone, it’ll die. For instance, some coral species do better in high temperatures and acidity. We could selectively breed these species to improve survival rates in higher temperatures and help these coral reefs adapt.

The third point, and perhaps the most controversial one, is that we’ve already been geoengineering the planet, albeit accidentally, through carbon emissions. When people talk about solar radiation management, there’s this scary idea of geoengineering. We’re talking about things like reflecting more sunlight back into space through cloud brightening or injecting aerosols into the stratosphere. Nobody wants to do this, but let’s be clear: We’re already doing it and undoing it unintentionally.

We have this status quo bias of like, oh, as long as it’s accidental, it’s fine for us to play God. But God forbid that we start coming up with a plan. And some of these things like solar radiation management are so cheap that Bill Gates could afford to just do it on his own. He’s not going to, but if we don’t do the science, then somebody’s going to do it without having data on what the effects are. So I think that’s more irresponsible than actually understanding it.

Watch the full conversation: