The Economist - USA (2019-11-30)

16 Leaders The EconomistNovember 30th 2019

2 ministration’s refusal to appoint new judges to replace those

who are retiring, a symptom of the president’s suspicion of mul-

tilateral institutions. But it is a mistake to blame everything on

him. The wto’s troubles expose deeper problems.

Most countries like independent arbiters, until they suffer a

critical ruling. American unease predates Mr Trump. The Bush

and Obama administrations tried to influence outcomes by

blocking the reappointment of judges. The wtois also unwieldy.

Ideally the rules would be updated every decade or so, giving

countries a chance to modernise them and take on judgments

they dislike. But the wto’s membership has doubled since 1995,

and because each country has a veto it has been impossible to up-

date the rules to reflect, say, the disruption caused by China’s

state-led model (it joined the wtoin 2001). Instead, grumbles

have festered.

What happens from December 11th? Some wto members are

trying to concoct an unofficial appellate body, drawing on re-

tired judges, to resolve disputes. A new president elected in 2020

might reverse America’s stance, although several Democratic

presidential contenders are lukewarm on free trade.

Most likely, the appellate body will die, or remain dormant for

years. If so, expect a deterioration in conduct—Japan and South

Korea are already in an ugly spat. Some Americans believe that

their country’s size gives them the raw clout to impose rules on

others, but it has yet to wrest any big concessions from China.

Indeed, as the legal framework for trade decays, even America

will be vulnerable to escalating tensions. So far, trade frictions

have not caused a global recession. But trade has stopped grow-

ing and long-term investment by multinational firms dropped

by 20% in the first half of this year. If there is a recession, the

temptation of tit-for-tat tariffs will rise across the world. When

the referee leaves the field, anything goes. 7

S

olar andwind power are the glamorous twins of the clean-

electricity revolution. It is thrilling to see a field of glistening

panels absorbing the sun’s energy or a vast turbine twirling

above the ocean. Stationary power storage does not have quite

the same allure—think of a large metal shed stuffed with piles of

big batteries. Nonetheless, the ability to stockpile energy on a

massive scale will be of supreme importance if the world is to

wean itself off filthy fossil-fuel power plants. The technology is

gradually getting cheaper and attracting investment (see Busi-

ness section). But more needs to be done to ensure that it sparks.

To see why storage is important, work backwards from the

most common strategy to limit climate change. Plans typically

reduce emissions from electricity generation by switching it

away from fossil fuels, then electrify other carbon-belching ac-

tivities, such as driving cars and heating build-

ings. Abundant, reliable, clean electricity is the

foundation on which many green investments

and policies rest. And to work well, clean elec-

tricity in turn depends on storage.

Nuclear plants could supply steady clean

power, but they attract fierce opposition and are

beset by cost overruns. Solar and wind are the

fastest-growing alternatives. Today they ac-

count for 7% of global generation, twice the sharein2013.Butthe

sun does not always shine and the wind may not blow. As the

share of intermittent sources rises, so will demand for energy to

offset swings in supply. In the short run, dirty coal and gas will

have to provide flexibility. Eventually, however, storage must

play that role, and the sooner the better. The aim is to capture so-

lar and wind power when it is plentiful and release it as needed.

Today pumped hydropower is the most common way to store

energy. When it is sunny or windy any excess electricity from so-

lar and wind farms can be used to pump water uphill into reser-

voirs, to be released later to generate hydropower. But lots of

places lack mountains, rain and room. Batteries are an alterna-

tive. They can smooth jumps and drops in supply and store re-

newable energy when it is abundant, as in California on a sunny

afternoon, and then release it in the evening, when demand

rises. They could transform big emerging markets that still plan

to expand their use of fossil fuels. The International Energy

Agency reckons that, excluding coal projects already planned,

batteries have the potential to cut the number of coal plants built

in India after 2030 by three-quarters.

If batteries are to realise their potential, they need to become

cheaper and better. Progress is being made. Lithium-ion batter-

ies have become 85% less expensive since 2010, as firms have

poured capital into factories to mass-produce batteries for elec-

tric vehicles. Investment in storage capacity will hit about $9bn

next year, predicts Bloombergnef, a data firm, four times the

level in 2017. But technical problems persist. For example, lithi-

um-ion batteries are bad at storing energy for long periods,

which is important in countries with rainy sea-

sons. Happily, firms are experimenting (see Sci-

ence section). Tycoons, including Jack Ma of Ali-

baba and Jeff Bezos of Amazon, have invested in

startups that are pursuing energy storage using

everything from novel battery designs to molten

salt to pressurised water pumped underground.

For firms and capital markets to work their

magic, a policy is needed—if only because, more

thaninother industries, the state sets the rules in power. Vested

interests and out-of-date thinking lead to a bias against batter-

ies. Last year America’s energy department granted $28m in re-

search awards for long-term storage—a pittance compared with,

say, the $150m the country spent on a tax break for coal royalties.

Many places offer subsidies or mandates for wind and solar pow-

er, but not for the storage it will depend on to work at its best.

All too often storage technologies do not enjoy the same ac-

cess to power grids and customers as dirtier sources of power do.

Last year America’s federal electricity regulator ordered the

country’s regional power markets to be opened up to storage, but

implementation has been sluggish. The shift to clean energy will

not happen unless it can be more easily stored. It is time for a

high-voltage jolt to help an essential technology thrive. 7

A bid for better batteries

Clean energy grids will not thrive unless the world gets better at storing power

Climate change and energy

Cumulative energy storage

Forecast,terawatts

Restofworld

India

UnitedStates

China

252020 30 4035

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