Estimating your DollarShadow    J.L. Henshaw  
7/05/07 9/28/10 12/3 1/8/11  Research notes on How to Understand the True Scale of your Energy Use

Example: the energy cost of the ink and paper, for printing handouts
$30/ream = 30lb of CO2
(7)(hist)(sci)

     I print handouts for meetings, hoping the information will have a greater compensating effect on reducing our energy consumption in the end... but it may take a while.  If I spent on anything else, on average it would have a similar scale impact in hidden energy costs throughout the economy. 

     At present, printing a 200 page ream of paper on my desktop printer might use up a $20 ink cartridge, making the cost of the ink alone $.10 per page!   The ream of paper weighs ~2lb, costing about $10 too.  So, as average use of the economy the total would be $30, and have a carbon impact of 30lb of CO2 from fossil fuels added to the atmosphere

     That is 15 times the weight of the paper, in CO2 pollution to hang in the air for over 100 years, warming the planet...  It's not a 'good' equation, but will do good in helping correct our economic steering !

The "big secret" is hidden environmental services all around the world are your largest environmental impact.   What you pay business for gets passed on to pay for widely distributed chains of services as part of what you purchased.   It makes you financially responsible, and moreover directly exposed to, the not so hidden dangers connected to the economic and environmental harms the earth now rapidly emerging, that no seems to realize they are paying for and so responsibility for.

When lacking specific information, a scientific accounting must treat hidden energy uses as "average", using the "null hypothesis" that allows the accounting system to "close".    

It turns out the world community has been making the opposite assumption, only recognizing energy impacts and financial responsibility for them that people have specific information on, a regular practice of ignoring what is hidden, and being directly paid for as we use money.  That's not sustainable!    The practice has been to use the wrong "null hypothesis" for lack of specific information, treating the hidden energy costs of using the economy as "zero".  This has caused all kinds of misunderstanding, treating "sustainability", as meaning "hiding your impacts".

 The world average energy use impact  for any average dollar spent
is the ratio of total purchased energy supply (TPES) to world total end user product (GDP) (7)(sci):

~8000 btu or ~7.6 jules or 2.4kWh  (/$GDP)
impacts more easily understood as equal to  ~1lb or .46kg of CO2 (/$GDP)

that's the "reality math" needed to account for the large hidden energy use behind every product and service,
and to make sustainability accounts "close" by reflecting true shares of the world total
in doing for your Scope 4 Whole Systems Energy Assessment


Five True Energy Budget Stories: 
1) What AVG means 2) Scale of Hidden Energy  3) PV area  for AVG$ 4) Suburban Home 5) Consumer Products 6) Global PV Footprint 7 IEA Data & Trend

for example - Volume of CO2 per $ GDP :  0.46 kgCO2/$  *  2.1m3/kgCO2  => 0.97 m3CO2/$ of GDP
so if you make $50,000 a year that's 50,000 cubic meters of CO2 produced for you as a world average, the volume of ~20 three story townhouses...
Pollution is often removed by hiding it, with outsourcing or reducing visible part, quieting the messenger so its silent, but still deadly.

 

1. What Average means: (& sci notes)

The world average energy use per dollar of GDP is the amount of purchased energy resourced from around the world to deliver an average $'s value of goods or services.   Because it's so much larger than the visible energy uses of commerce it is a much more accurate measure than even very carefully tracing visible energy uses (f).

To measure individual economic impacts on the earth $1 1 average share of the world economy, its total energy use and all its impacts, since every $ needs the services of the whole economy (i) (ii)... Which turns out to be surprisingly accurate for energy use (f)

AVG = 8000btu/$ (or 2.4kWh/$) (IEA 2006 world TPES/GDP-PPP) = the usual accumulative total energy demand of money   

i) Average values are true for individual cases "on average".. and most products require such highly divers energy uses to deliver them it's also rare for the energy required to deliver the $1 of value to be far from average (f).
ii) I finally found people interested and able to study  the sources and equations to confirm these figures from Table 1 below, in a discussion on Azimuth with John Baez.  There was one "small" error found, now corrected, made in revising the whole calculation for this update of the old work.

2.  The scales of visible and hidden energy use:

Systems Compared Financial Budget Visible Energy for Fuel Use Energy Demand  for Economic Services Total Energy Demand Units The error in believing your visible energy use
Wind Farm (per kW size) (iii) $213 0.10 0.45 0.58 kW 532%
Family in town w/car (iv) $50,000 120.95 105.48 226.43 mW 187%
Family "off grid" w/car (v) $52,000 101.26 109.70 210.96 mW 208%
Family "off grid" walking (vi) $52,000 5.13 109.70 114.83 mW 2237%

Each dollar of a family budget has an energy impact by requesting services from people who will consume energy in delivering the service, making the purchase of services an energy burden and source of impacts on the economy and environment.

iii) The SEA study of a wind farm showed that the direct energy for producing wind energy was only about 18% of the business energy demand for economic services.
iv) A modest income family in a 2000sf house for might pay $2500 for heat and electric and $1800/yr for gas  in the car for a short commute and running around.
v)  The same family, generating its own energy by Wind or PV might be able to generate their own heat & electric, a little less efficiently than commercial energy
vi) The same family, walking to work and store, generating their own energy and just using a taxi now and then.
 


Your $'s as an area of land, for collecting the energy

If the economy got its energy from The Sun, every dollar would... cast a shadow.  
comparing the energy used by the economy to the areas of land needed to collect the energy, per $ of GDP

 

3. Calculation of PV Area

- "average" solar radiation availability picked from radiation map below,  note: mismatch between population areas and solar radiation availability -

Table 1.  
Solar energy available for PV (a)                      meters^2                                                       feet^2
(See Figure A below)       kWh/day 5000 kWh/m^2.dy = 465 kWh/sf.dy
per year 1825 kWh/m^2.yr = 169 kWh/sf.yr
BTU/year 6229 kbtu/m^2.yr = 579 kbtu/sf.yr
High Performance PV          
* reduce for efficiency 0.19     110 kbtu/sf.yr
** reduce for coverage 0.5     55.0 kbtu/sf.yr
*** reduce for EROI cost     45.8 kbtu/sf.yr
At avg. btu/$ GDP (b or Table 3)          
world GDP (PPP) 2008 63865 Billion $      
world energy use 2008 512285 Quad btu's      
to make $1, at world avg intensity 8021 btu/$ *      
Energy content of oil 138000 btu/gal      
energy equivalent of oil per $ 6.5 oz/$      
Area needed per $          

to make 1$ per year

0.016 m^2   .175 sf **

to make 1$ per day

5.94 m^2   63.9 sf**
 

* A nominal peak efficiency of 19% is now achievable for solar panels. It might be 50% in the future, but at high cost.
** A rough estimate that solar panels would cover 50% of the land area in a solar farm
*** The EROI (energy return on energy invested) of 6:1 is a rough estimate using SEA (d)  for the "usual" net energy produced by high performance PV solar farms in the US economy.    It seem likely to be optimal rather than average, but would take study.   The value would be quite sensitive to the costs of the land, operations and equipment, as well as the average radiation from the sun at a particular location.  The value of 6:1 means that 1/6 of the energy gain is lost in the effort to produce energy.

Figure A. Annual average daily solar radiation available in the US overlaid with 1990 US population density (a, e)

One reason to think of our impacts on the earth as proportion to the money we earn and spend is that every dollar is one equal share of the total product of the whole world economy.   All economic impacts are energy impacts, and all the things that cause economic impacts are purchased.  For energy use the "average energy per dollar" also turns out to be a fairly accurate estimate of the real total use of energy and production of CO2 pollution, seemingly +/-15% mostly.    What you can be sure of is it will be fairly close most of the time, and will be a far more truthful measure of the scale of impacts for  any purchase choice than zero.

Why it's fairly accurate most of the time is because energy is the universal resource, and traded around the world at a world price, as discussed a bit further below.   The best present research on this method of analysis is a draft paper Defining a standard measure of energy use for businesses, using a wind farm and its energy return on investment (EROI) as an example.   By switching from adding up the receipts businesses collect from purchasing energy, to treating the prices of things as a receipt for average energy use in all the work that went into what was purchased, four times the energy uses being employed are found.   The main reason is  ... *because we pay for them* ... and the price we pay is an accumulation of all the prices reflecting the work of all the people and machines along the way that brought the product or service to us.   That's the key.   It will change how energy accounting is done entirely when it is appreciated that economic footprints are far easier and more accurately measured with money than trying to follow almost untraceable threads connecting diverse causes and effects, as well as the significance of finding a 500%+/- typical error in our primary measure of sustainability....   9/28/10

4. Suburban Home Example:

 

Budget for an "average" suburban home with a 1500sf footprint and family income of $75k/yr,

 

Energy budget

CO2 budget

step 1 Energy/GDP => $1 share ≈ 8000btu/$ (or 2.4kWh/$ ) CO2/GDP ≈ 16oz/$ (or .47kg/$)
step 2 Using Solar Panels to produce a $1 share  ≈ .175 sf for a year (table 1).  needing to burry purchased charcoal to  sequester the carbon costing $.16/kg (iii)
step 3 needs 13,125 sf area for PV panels, produces =32.3ton CO2 in global fuel uses
step 4 needing a solar farm ~9 times the home's roof area,
to be truly grid neutral
(iii)
spending $11.3k/yr on sequestration
to be truly carbon neutral
(iv)

iii) Using Charcoal to Fix the price of carbon emissions http://sspp.proquest.com/archives/vol5iss2/editorial.gray.html assumes no continuing land use cost to protect the buried carbon
iv) "truly grid neutral" and "truly carbon neutral" are a quick way to say that the family provides as much energy and carbon sequestration for the economy as the family takes from the economy as a whole, "on average".  "Normal" economic growth of 3.1% per year would increase the PV area and cost of CO2 sequestration ~1.8% per year, slower than the growth rate due to normal efficiency improvement.
 

5. Consumer product Example:

Money spent on a soda or glass of wine, like a receipt for a share of world energy and carbon costs. As a measure of energy use it's quite accurate, on average, and makes spending or earning a dollar responsible for one equal share of all the impacts of energy use too. You can appreciate the meaning of "average share" using it to measure how much CO2 (your carbon footprint) is created with normal expenses. Try to compare the benefits and the costs with these two examples. (b Table 1)

So... a 16oz soda for $1.50 would put ~24oz of CO2 into the atmosphere, as average spending  from conventional energy sources, and use  the equivalent of 10 oz of oil.   To use solar energy it would take the use of a 100sf of a solar farm for a day to generate the same energy with PV.  

And... a 6oz glass of wine costing $6 would produce ~96oz (6lb) of CO2, 16 times the weight of the drink as average spending for conventional energy sources, using the energy of 39 oz of oil,  or... require the use of a 384sf of a solar farm for the day to get the same energy from PV

6. Global footprint Example:

The global "dollar shadow" for using PV to supply the present world energy demand, estimated in %'s of the World Agricultural Land Area

I  did the estimate using the PV values from Table 1. and agricultural land area figures from Nationmaster.com (c), and IEA economic statistics (b) as shown in the table above.     That gives 1$ of economic product needing 5.9 sq meters of sunshine for a day, or .016 sq meters per yr, to deliver the world average amount of energy per $.    It's rough, because the solar radiation varies so widely from place to place, so to be accurate it would need to be averaged over all the land area where people might use PV.    I then use the historic energy use "growth constant" (b) of the past 40 years,1.89%/yr  which results in a 37 year doubling period for energy use.    World GDP $46.9 trillion in 2000(b) that would have cast a dollar shadow of 15,490,000 sq km,  with world agricultural land area 48,033,854 sq km as 40% of the total land mass of 120,000,000 sq km.

Table 2.

World dollar shadow as a % of present total agricultural land and the world landmass

% of Agricultural Land in 2000 

1.6%

 

as % of landmass in 2000

.6%

% in 37 yr  

3.2%

 

% in 37 yr  

1.2%

% in 74 yr  

6.3%

 

% in 74 yr  

2.46%

% in 111 yr 

13%

 

% in 111 yr 

4.9%

 


Does anyone see a problem with this?? 
..or with needing to locate the solar farms near the people?? ..or with the cost of renting the land for it, ..or what's wrong with the figures??

 


7. Global Trend Data and Relationships:

 IEA World economic data - Key indicators GDP Energy & CO2
partial 2008 data for Table 3. and Figure 1.,  for 2010 IEA source data see reference (b)

Table 3.

1990

1995

2000

2004

2005

2006

2007

% change

notes

Mt CO2 Sectoral method

20980.5

21810.4

23497.3

26336.1

27147

28028

28962.4

38.00%

 

TPES   (PJ)

366834

386311

419463

465685

478361

490696

503664

37.30%

 

TPES   (QuadBtu)

347.71

366.1716

397.5953

441.4076

453.4227

465.1147

477.4066

37.30%

x

TPES  (QuadkWh)

0.1019

0.1073

0.1165

0.1293

0.1329

0.1363

0.1399

37.30%

x

GDP   (billion 2000 US$)

24199.8

27133.3

31979.8

35356.1

36585.9

38046.5

39493.3

63.20%

 

GDP PPP   (billion 2000 US$)

33299.1

37759.5

45572.7

52626

55156.7

58179.4

61428

84.50%

 

GDP/GDP-PPP

0.7267

0.7186

0.7017

0.6718

0.6633

0.6540

0.6429

-11.53%

*

btu TPES/GDP

1436.8

1349.5

1243.3

1248.5

1239.3

1222.5

1208.8

-15.87%

**

btu TPES/GDP-PPP

1044.2

969.7

872.4

838.8

822.1

799.4

777.2^
[8000]

-25.57%

**
^

kWh TPES/GDP

0.4210

0.3954

0.3643

0.3658

0.3631

0.3582

0.3542

-15.87%

**

kWh TPES/GDP-PPP

0.3059

0.2841

0.2556

0.2458

0.2409

0.2342

0.2277^
[2.4]

-25.57%

**
^

Population   (millions)

5259.2

5675.7

6072.7

6382.3

6458.9

6535.2

6609.3

25.70%

 

kg CO2 / GDP 2000 US$

0.87

0.8

0.73

0.74

0.74

0.74

0.73

-15.40%

 

kg CO2 / GDP PPP  2000 US$)

0.63

0.58

0.52

0.5

0.49

0.48

0.47^
[~1lb]

-25.20%

^

Ton CO2 per capita)

3.99

3.84

3.87

4.13

4.2

4.29

4.38

9.80%

 

Mton CO2/QBtu

60.3

59.6

59.1

59.7

59.9

60.3

60.7

0.5%

***

 

^ 2007 IEA data, rounded for use in generic footprint calculations in brackets [##], for 2014 est ~ 3.6% lower, for regular historic rate of the economy's improving energy efficiency. 
x - original data converted to Btu & kWh units
* energy/$ values (economic intensity) declining over time at 1.3%, ~25% in 30 years
** ratios of GDP adjusted and unadjusted for "purchasing power parity" PPP to remove monetary exchange rate discrepancies, for the US unadjusted GDP$ is only ~5% higher than its PPP adjusted value. 
*** For climate change the key observation is that steadily improving producer efficiency completely overcomes consumer efficiency, to continually multiply energy use, it also does NOT change the share of fossil fuel used to produce energy at all, as reflected in the near constant CO2/Btu ratio... Info on CO2 from Wikipedia

Recent Economic History -    We see here the surprisingly regular progressively changing rates of world economic growth (+3.1%/yr), the energy use required (+1.9%/yr), CO2 produced (+1.9%/yr), and our rate of improving energy efficiency, at (+1.2%/yr).   

It's very odd, that these curves clearly show the world economy having a highly regular behavior as a whole, and so also indicate the world economic system having a stable "design", in how the parts are organized and working together.   It's both odd that the world economy has such remarkably consistent behavior, and also that it is very generally not discussed, particularly in relation to our world preoccupation with changing the linkage of these very same behaviors of the world economy, for "sustainability".    

That we don't seem to study the design of the system we're trying to change, is a problem.    The regularity of the curves shows a highly regular behavior.   Plans for an opposite behavior would need to take into account, like the staple designs for "sustainable development", for having efforts to increase efficiency and producing alternative energy to result in decreased energy use and CO2 (respectively) the reverse of their historic whole system behavior of accelerating increase with improving efficiency.

                              Figure B (f, h)


8. The scientific basis for measuring impacts with money:

It sounds crazy at first, and so most people then never ask "What about the averages".   That's the secret, being cautious about your snap judgments, when the whole problem seems to be "How would anyone know?".    Here's the answer to how anyone can know.   

In paying for the economy to deliver goods and services, nearly all our uses of money are passed on to such a wide variety of people, who all spend the money they receive on such a wide variety of different kinds of consumption, the sum total of the hidden energy uses involved ends up being similar to paying for anything else, i.e. "about average'.   It's not that further studies aren't needed, of course.  It's that based on that distribution, and your initial lack of better information:

  1. "average" is probably a reasonable estimate for scale, and certainly far more truthful and accurate than 'zero', and

  2. for those studies to find where it varies, "average" is the only scientifically legitimate place to start, necessary to "close the accounts" by having the totals of impacts equal the total of responsibilities assigned for them.

The more technical ways to reach the same conclusion involve modeling how money travels in the economy.    My way of doing it starts with setting proper bounds.  It's clear that you want to only count energy uses once, and for the total to equal the economy's total.   That is not assured using the method mentioned in the original paper "Systems Energy Assessment" of tracing a typical pattern of money being passed to multiple contributors to the service provided.   Like the reasoning in #1 above, finding that in three month's time parts of any dollar used would end up in the accounts of every person on earth, demonstrates a wide distribution, and "startling likelihood", but there is no "end point" for that distribution.   

A good way to define an end point is a new way of using the same device that economists use for measuring the total product of the economy, GDP, as the sum of the "end user" purchases in a given year.   That defines an end point if the chains of production of the economy.   The other "end" of the economy is the accumulation of services paid for to deliver the end products.    So you have a 1-1 mapping of the economy, from "end users" (as the people consuming the products) to the "end producers" (as the people paid for their services in producing it, who use what they are paid for their own end consumption)

So the economy can be mapped as an accountable exchange between end users and end producers.    Money that is paid for any end use is granted "free and clear" of obligations (except those paid for) to the service provider, and then at first largely "passed along", from one business to the next to the next, with some at each stage being paid to people also "free and clear" as "end producers", for them to use for their end uses.   So the money being paid for all the multiple branching services in the product and service chain that are needed to deliver any product, has no destination other than some person, mostly hidden from view way down the chain somewhere, being reimbursed for contributing their end services, free and clear.

The visible services used in delivering a purchase to the end user

The chains leading to mostly hidden services from the end producers needed

Figure C.

 (table 4 shows that most of the end producer services needed are in the "fat tail" of the chain)

What a mathematical model seems to show is that the hidden part of the distribution is much larger than the visible part.  The distribution has what is called a 'fat tail' in the sense that most of the end producer consumption is far down the line, and so also more likely to be "average".   Statistics won't help much, but network science could somewhat, if only to help further clarify how reliable the scale estimate of "average" is, and why it will be economically infeasible to use any other estimate except for large impacts for which information is readily available.  

If you assume that economic supply and service chains have a "normal" branching pattern, you can examine the shape of the distribution.   You might guess that spending on end products normally goes to a mix of smaller and larger businesses.   To study that you start with a simpler model, and see if it's possible to model more realistic assumptions.  What is fairly easy to explore is a rule that the largest part of the economy is made of businesses with 40 employees and 50 business service providers paying about 20% of their revenue in salaries.  That might vary widely in reality, of course.   The Wind Farm we modeled for SEA (see p 17) seemed it would have only about 2% of its revenue in salaries, while employing lots of business services from companies with a more normal ratio.

So taking the simpler case, you get a polynomial expansion, with each step

  1. removing 20% from the money chain,

  2. multiplying the number of employees by a factor of 40 and

  3. multiplying the number of businesses by a factor of 50.  

We'll try to trace where the money goes for a single $100 purchase from a business, in turn paying 40 employees of all kinds and purchasing producer services from 50 businesses, which each also have 40 employees and buy services from 50 businesses.   After just 4 steps, one purchase is shown having paid for the services of a highly diverse group of over five million people running and operating over 120 thousand businesses, with only 50% of the end production services paid for.

Numbers of people & businesses paid for services
along a business production chain

Table 4.

Starting from the consumer purchase - steps along the chain

 

1

2

3

4

5

$ to businesses

$100

$80

$64

$51

$41

$ to people

0

$20

$16

$13

$10

(share remaining)

100%

80%

64%

51%

41%

 

 

 

 

 

 

# of people pd

0

40

2,000

5,000,000

625,000,000,000

Tot people pd

0

40

2,040

5,002,040

625,005,002,040

 

 

 

 

(millions)

(billions)

# of businesses pd

0

50

2,500

125,000

6,250,000

Tot businesses pd

0

50

2,550

127,550

6,377,550

 

 

 

 

(thousands)

(millions)

 

Network analysis could be done on the data for international trade, such as is compiled and used for EF, Ecological Footprinting, for example.  That or similar studies might shed some light on what kinds of spending or what kinds of producers deliver lower than average impact products and services.   They won't erase the problem that most "end producers" will remain hidden from view, lost in the fat tail of the distribution, just because the information gathering task is too difficult.    As competing designs for lowering the economy's impacts are studied and tested, more exceptions may appear, but using this kind of complete accounting approach won't cause all the prior hidden impacts to re-disappear or things like that.  

jlh 2/20/14

References:

a -  National Renewable Energy Laboratory, http://www.nrel.gov/gis/solar.html  Historical average solar radiation at the ground: (picking a "typical" average mid latitude location) http://www.nrel.gov/gis/images/map_pv_national_lo-res.jpg
b -
 IEA World Highlights: www.iea.org/co2highlights/co2highlights.pdf  & 2010 historical data: http://www.synapse9.com/design/IEA-worldindicators.xlsx 
c -  Agricultural land use figures
: www.nationmaster.com
d -  Method for measuring whole system energy use and EROI: System Energy Assessment (SEA)

e - ThoughtForm pop. map http://www.visualizingeconomics.com/2008/09/07/us-population-density-1990-and-2000/
f -  see System Energy Assessment (SEA) for Whole Business Systems, Henshaw et all, 2011 extending a 2009 talk
h - Understanding why the economy behaves as a whole The curious use of Stimulus for Constraint, Henshaw 2011
i -  an archive copy of this page from 2009 with possibly useful early thinking on the issue

 



jlh Explorations