Article published in BioPhysical Economics and Resource Quality (paper publication in September 2019)
This article shows that as technical change enhances the conversion efficiency of primary-to-final and final-to-useful exergy processes, the minimum exergy return ratios (ExRR) required for society decreases, irrespective of the boundary under consideration. Therefore, the gains in exergy conversion efficiency that mostly occurred between the 1940s and the 1970s have compensated for the concurrent decrease of exergy surpluses of the fossil energy system. However, while the minimum ExRR required for modern societies have been quite stable since the 1970s, actual ExRR prevailing for energy systems have continued to decrease. Therefore, the increased difficulty in improving exergy conversion efficiency since the mid-1970s has resulted in a tightening exergy constraint on economic growth; this could partially explain the global economic slowdown of the last forty years. Further work is needed to estimate actual exergy return ratios that prevailed in the past decades and compare their distance relatively to the minimum levels estimated in the present article, and hence have a more precise idea of the exergy constraint’s magnitude acting on economic growth.
Victor Court is a research associate at the chair
Adopting disruptive technologies for decarbonizing hard-to-abate industrial sectors requires experimentation through demonstration (pilot) projects. However, from an economic perspective, the potential long-term benefits and the difficulties in designing relevant public policies are not addressed in the standard valuations of those projects.
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