SWJ Book Review – Energy’s Digital Future: Harnessing Innovation for American Resilience and National Security

SWJ Book Review – Energy’s Digital Future: Harnessing Innovation for American Resilience and National Security

Chris Bronk

Amy Myers Jaffe, Energy’s Digital Future: Harnessing Innovation for American Resilience and National Security. New York: Columbia University Press, 2021 [ISBN: 978-0231196826, hardcover, 248 pages]

More than anything else, economists seek to understand equilibrium, however, societies often face wrenching difficulty when points of equilibrium shift. When these shifts occur, analysts of intelligence must make every possible effort to open themselves to the reality that their fundamental assumptions on the phenomena at hand may change, possibly quite significantly. In her Energy’s Digital Future, Professor Amy Myers Jaffe provides us with a stacked set of indicators of change regarding the geopolitics of energy, which for roughly a century involved access to oil and gas reserves, often distributed far from the consumers for those fuels, resting beneath the soil and sands of some of the planet’s tougher neighborhoods.            

Professor Jaffe has written a book that takes a stab at the question, “What replaces oil?” Two decades ago, we worried about peak oil production, now sensible minds are more preoccupied with the unexpected ecological concerns of burning so much of it, and an attendant concern for peak oil demand. Security scholars have been wrong about oil issues before. Thomas Fingar, the then-chair of the National Intelligence Council, pointed out that in the 1970s there were assessments of a hypothetical Chinese oil boom, which never happened[1]. Today we have all sorts of trendlines on emerging technologies for the energy sector. Once curiosities, renewables such as solar and wind are seen as vital, ecologically safe sources of electricity. These technologies may grow to matter a great deal, but what’s especially novel about Prof. Jaffe’s thesis is her emphasis on the enormous role that information and computing technologies will assume in global energy systems.

Jaffe’s monograph is one of policy forecast, informed by the disciplines of history, science and technology studies (STS), and economics. That she can hop between these disciplines readily is a testament to her multifaceted understanding of how industrialized economies acquire and employ energy resources. In the book, she lays out a terrain of energy history and then moves on to the transition afoot in the economics of energy. She correctly identifies China as the peer competitor, and then dives deeply into a study of the potentially transformative technologies which may emerge. Also included is a warning on conventional thinking in energy, which boils down to the need for the United States to begin assuming a leadership role in the transformation.          

The book is structured with an introduction and nine substantive chapters followed by a conclusion.  The chapters have pithy clever titles such as: (1) Lessons from History: Nothing is Inevitable, (2) Revolutionizing the link:  Energy and Advanced economic development, (3) China’s energy security, (4) Meet the Jetsons: Revolutionary Transport via Automation and Data, (5) Alexa: Beam me Up Clean Energy, (6) The Energy Future and the Possibility of Peak Oil Demand, (7) Energy Investor Dystopia, (8) The losers: The Changing Geopolitics of Oil, and (9) Geopolitics of a Greening Economy.  The conclusion covers recommendations for the United States which I will discuss at the end of this review.

In the main, Energy’s Digital Future rests upon two pillars, the role of technological change in altering the global energy system and China’s position in contesting Western technological and geopolitical dominance. Each of these deserves attention, technological change in energy is the obvious lead for this book. Jaffe’s conclusions are hardly ahistorical in nature. She chronicles the shifts in energy associated with the tremendous innovation here in the United States at the turn of the 20^th Century, when two names, Ford and Edison dominated it. Nikola Tesla, the figure beloved and revered by our current generation of technological robber barons, goes unmentioned, but the car company for which he is named is covered at great length.

A fundamental message of the book is that change can happen, especially regarding sources of energy. Jaffe’s mention of US feed hay production peaking in 1909 serves as a reminder that industrial societies are fully capable of shifting from one source of transportation to another in a relatively short amount of time. In the period of a couple decades, the United States largely abandoned the horse and moved on to the automobile, and its larger cousin, the truck. Yes, there were electric cars a century ago, but gasoline won the day, and Henry Ford’s vehicles took a prominent role in the mechanization of logistics and transport on the First World War’s Western Front long before American doughboys began showing up in France.

One item she missed in the gradual transition from coal to oil is the enormous way in which bunker fuel oil changed naval operations. Migrating from a solid fuel to a liquid one revolutionized naval warfare and maritime commerce. While oil became deeply entrenched as the fuel of choice in the United States and other major powers (because they had an abundance of the stuff), it is an interesting side note that those nations without ample oil reserves and limited access to sources. Germany and Japan, for example, watched their military power dwindle for want of gasoline, bunker oil, and aviation spirits. The world’s navies saw the enormous value in oil for propulsion, and logistical feats like replenishment at sea made them ever so dependent on the stuff.

But once dependent, it became difficult for societies to think of other sources of energy, which Jaffe chalks up in part to the problem of path dependencies. Once countries decided to make the switch to oil, massive investment in infrastructure, from pipelines to filling stations bounded societal capacity to switch to alternatives. Three Mile Island, Chernobyl, and Fukushima stand as radioactive reminders of failure to master nuclear fission—something the US Navy has done, albeit at enormous cost. Oil dependency has also caused us great concern over resource wars. While accruing influence may be important in the race for rare earths or other commodities critical to emerging technology, she does not offer a great deal of detail in how conflict may change, except for the cyber dimension and how strife in that domain may be the definitive form of conflict in a digital energy future.

This belief makes sense. In September 2012, shortly after the Shamoon hack against Saudi Aramco, I collaborated with Amy Jaffe on a conference regarding cybersecurity and energy.[2] She understood then, and even more so now, that cybersecurity was the soft underbelly of any innovative, computer-controlled system for energy production and distribution. What I did not realize was that Professor Jaffe was putting together a picture of how computing would change the energy business. In assessing this collision of technologies, she correctly identifies the important role computing has in the computer-aided horizontal drilling and fracturing which shifted the US from an importer of oil and gas to an exporter.

With the transition to a post-oil world necessitated by the damage that burning it does to our fragile global environment, Jaffe asserts the race is on to make a switch. Elon Musk’s homage to Edison’s failed rival may be a substitute for vehicles propelled by internal combustion engines (a class of vehicles that face bans in the world’s most developed nations in the next couple decades) however, the race is afoot for non-carbon energy solutions to propel those cars. Burning coal to generate electricity to charge a Tesla automobile may work, but it doesn’t do much to improve the global carbon situation. Those companies (and countries) which can develop economically viable, renewable sources of energy will likely hold the commanding heights of the global economy.

This is where China comes in. The People’s Republic’s ascendancy in all things technological is hard to dispute as it makes investments in mobile phones, telecommunications infrastructure, solar panels, electric cars, and the Internet of Things (IoT). Jaffe offers an eloquent argument for US national strategy on public investment in technological innovation, with which it is hard to disagree.            

Great powers such as China and Russia have invested heavily in hybrid warfare strategies that allow them—through proxies—to launch cyberattacks on critical infrastructure in addition to engaging in informational warfare strategies that weaken US national security on myriad levels.  Jaffe could also have made a more forceful argument for investment in cyber defense capabilities and regulations both from the government and private sector.  This would put the US in a better strategic position to defend and be resilient against these future hybrid warfare threats on energy infrastructure that will no doubt become more commonplace whether their source derives from great powers, minor powers, rogue states, or even non-state actors.[3] 

Jaffe’s book differentiates itself from other works on energy security by emphasizing the digital advantages and vulnerabilities of the newly emerging energy system.  In this sense this book would be of value to any lay reader wishing to gain a better understanding of the security implications of the digital changes to energy security.  This would include cyber policymakers and practitioners, political scientists, sociologists, think tank divisions looking at energy security, and security studies scholars.          

The deepest problem that I have with her thesis is one regarding optimism. I am unconvinced that the United States will act on such a strategy nor that the technology venture capitalists have any interest in funding companies that are capable of developing things more valuable than ride-hailing services or co-working spaces. Doing more than this is an imperative for the United States, but it remains an open question if such change can happen here.

Endnotes

[1] Fingar, Thomas. “Sources of Instability in the Middle East.” The Global Energy Market: Comprehensive Strategies to Meet Geopolitical and Financial Risks. Baker Institute for Public Policy, Houston, TX. May 21, 2008.

[2] Emerging Cybersecurity Threats: Public Policy and Technology Response. Baker Institute for Public Policy, Houston, TX. September 18, 2012.

[3] Chad Briggs. “Climate Change and Hybrid Warfare Strategies.” Journal of Strategic Security. Vol. 13, no. 4. 2020, https://doi.org/10.5038/1944-0472.13.4.1864.