Topics in Management 298D        Ivo Welch with

Winter Quarter 2020, Part II        Bradford Cornell

This half-course will be co-taught with Bradford Cornell, Professor Emeritus at UCLA.


Energy, Climate Change, and Finance

The preeminent issues of our time may well be the need to reduce carbon emissions planet-wide. Greenhouse gases lead to global warming and a host of associated collateral damage, such as ocean acidification.  The possibility of a tipping point could lead to disaster on a global scale never before experienced by humankind.    If this is to be avoided, it will require moving the world economy from dirty to clean sources of energy.  Although such a transformation is ultimately inevitable (when fossil fuels become scarce), the evidence suggests that it may be more urgent.  

Getting off fossil fuels will not be easy.  Fossil fuels account for more than 80% of primary energy both in the United States and world-wide.  They offer great advantages, such as high energy concentration, ease of transport, low-cost access, and an already established massive infrastructure.  Moreover, there is a strong interest lobby that supports their continued use.   Transitioning to renewable sources will likely be a long, complex, arduous and extraordinarily expensive undertaking.

This half-course focuses on the financial cost of such a transition.  Over the envelope calculations suggest that it will reach tens of trillions of dollars.  It will require not just great changes in energy generation, storage, and distribution, but also in manufacturing, construction, transportation, and office and residential life.

The key questions for this course is:

How, if at all, can an effective and efficient transition from
polluting to clean technologies
be promoted and financed?

Administrative Basics

Time:                Saturday, 3-Hour Afternoon Block

Office hours:        Saturday after class, as long as it takes.

Grading:  The majority of the grade will be based on the final student team presentations dealing with specific issues related to energy provision, climate change, and related financing:

Project Report (Group)


Project Presentation (Group)


Class Participation / Attendance (Individual)


2-Page Summaries of Previous Class Session




Reading Assignments and Course Schedule

The main text will be MacKay, David JC, 2009, Sustainable Energy – without the hot air, UIT, Cambridge, UK.  Read it before the class begins.

Further texts for interest are Smil, Vaclav, 2017, Energy and Civilization, MIT Press, Cambridge, MA; and Weitzman, Martin L. and Gernot Wagner, 2015, Climate Shock: Economic Consequences of a Hotter Planet, Princeton University Press, Princeton, NJ.

Useful Websites:


Note: Reading should be done prior to the week under which it is listed.

Session 1:  Review of the physics of energy and energy usage.  Analysis of data on energy usage both historical and projected in the U.S. and worldwide.  Introduction to the discount issue and trade-offs.

Session 2:  The tradeoffs involved in the movement to renewals.  The costs of climate change.  Integrated economic models of climate and economics.  Proposals for dealing with the public “bad” aspect of climate change.

Sessions 3:  The transition to renewables.  The costs of transition to renewables as a function of the speed and extent of the transition.

Session 4:  A deeper look at specific issues including presentation of student projects.

Readings to be determined.

Session 5:  A deeper look at specific issues including presentation of student projects.

Readings to be determined.

Potential Presentation Projects

(It is not required that students choose from this list.  Depending on class enrollment, projects could be individual or group-based.)