Proceedings from the International Conference on

Perspectives on the Development of Energy and Mineral Resources

Hawaiʻi, Mongolia and Germany

February 11-13, 2015
University of Hawaiʻi at Mānoa - Honolulu, Hawaiʻi, USA
Location: Center for Korean Studies

Original Conference Website

Introduction

This volume contains papers from a conference held at the University of Hawai'i - Mānoa in February 2015. Titled “Perspectives on the Development of Energy and Mineral Resources – Hawai'i, Mongolia and Germany”, it explored complex issues associated with energy and mineral development.

Semi-annual conferences are part of a partnership of the National Academy of Governance, the University of Potsdam and the University of Hawai'i at Mānoa. The College of Social Sciences and School of Asia and Pacific Studies at the University of Hawai'i organized this conference, with support from both partner institutions. It was held at the Center for Korean Studies on the Mānoa campus.

A conference that brings together representatives from Hawai'i, Mongolia and Germany must seem, at first glance, like an odd proposition. This oddness recedes in the light of how the relationships evolved and the parallel issues each place faces with respect to questions the conference addressed.

The University of Hawai'i – Mānoa (UHM) began a relationship with the Academy of Management in Ulaanbaatar, Mongolia in the late 1990s. The Academy for many years has been officially charged with educating and training officials at all levels of government throughout the country. In 2002 it invited UHM representatives to join an international conference on globalization and development that it hosted in Ulaanbaatar. Two conferences followed, in Honolulu and in Mongolia respectively. The first addressed security issues in northeast Asia, the second the opportunities and challenges presented by Mongolia's transition to democratic institutions.

Representatives from what would be re-named the National Academy of Governance (NAoG), UHM and University of Potsdam, at the conclusion of the democracy conference in Ulaanbaatar in September 2011, drafted a new Memorandum of Understanding. The University of Potsdam's (UP) inclusion in the Agreement reflected a relationship between it and NAoG that was parallel to that between NAoG and UHM. The new Agreement, signed in August 2012, committed participants to collaboration on curriculum development; research funding and joint projects; short-term summer programs, faculty exchanges; and semi-annual conferences focused on issues of mutual concern.

“Perspectives on the Development of Energy and Mineral Resources – Hawai'i, Mongolia and Germany” is the first of the semi-annual conferences under the tri-part agreement and brought together issues that are compelling for each of the partners. Not more than a decade ago Mongolia entered a period of intense external and internal interest in the development of new-found resources. These included substantial reserves of copper, gold, coal, uranium and molybdenum, along with other minerals and trace minerals. The discoveries got the attention of both nations and mining firms seeking access to these valuable resources in a relatively stable political and economic environment. Inside Mongolia the intense global response raised fundamental questions about who would benefit from the new wealth, and how that would be decided. These questions were joined by others about Mongolia's energy future, in particular whether it could find a way to be less dependent on its neighbors for energy and thereby increase its national security.

Hawai'i, the second partner, sits in the middle of the Pacific Ocean, the most remote, heavily populated place on earth. The population of 1.4 million is approximately half of Mongolia's, and in both places it is very heavily concentrated in the capitals of Honolulu and Ulaanbaatar. Hawai'i's isolation presents particular problems and opportunities for its energy future. It historically has been dependent on the outside world to meet the energy demands. Oil overwhelmingly was the resource relied on and, because it must be imported, gave Hawai'i the highest cost per kilowatt-hour in the United States. At the same time these high costs have made the alternative and clean resources that are available in the state, such as solar, wind and geothermal, more cost competitive than in places that have lower costs to begin with. This "advantage" has allowed remarkable successes in meeting first-stage energy goals. Now however Hawai'i must face the challenge of moving beyond its early successes to achieve something much more ambitious:  energy independence. As with Mongolia, this raises questions of who will benefit, and what role government will play in determining that.

Germany is well known for the initiatives it has undertaken to develop energy alternatives and to reduce its dependence on imported oil, particularly from Russia. It has been a leader in clean and renewable energy and especially in power derived from wind turbines. It must determine how far it is realistic to seek to go in becoming less dependent on fossil fuels and nuclear energy. For Germany both energy and natural resource development are directly related to questions about national security. It has a well-developed network of administrative agencies and research universities that support building relationships that result in exporting technology and expertise, or importing needed resources. Mongolia is one of the places where this is being explored.

Attendance for presenters was by invitation only, and each was asked to address global, national and local factors affecting energy and mineral development. This was defined as factors in the global and regional environment, national and local political dynamics, and the role of public participation and public opinion. Participants also were requested to give attention to the ever-present subtext questions of who benefits from the development of mineral and energy resources, how fair this is, and the role public institutions do or should play in determining these outcomes.

Another feature of the conference was its emphasis on dialogue and discussion. Participants were asked to send ahead drafts of their papers, to be posted for review by other attendees. Presentations were limited to 20 minutes, with a focus on the primary issues and most compelling questions they were addressing. The majority of session time then was allocated to dialogue.

The fourteen papers revised after conference discussions are organized into four sections. The title of each is followed by a brief description of its contents. A longer abstract is included at the beginning of each paper, and information about authors is presented following the last paper.

Readers are encouraged to read of these for its own content, but also to look for the links between them and how, for instance, an issue in Mongolia is informed by something written about a parallel issue in Germany or Hawai'i. A few examples illustrate this suggestion. In the first section Robbie Alm and Jargalsaikhan Mendee present complementary and contrasting views about the challenges facing the development of public-regarding energy and resource policies in Hawai'i and Mongolia. In section two Charles Krusekopf raises concerns about the role of the state in resource development in Mongolia, while Mark Glick makes a case for government having a strong hand in capitalizing on the state's alternative energy resources and Maurice Kaya urges vigilance in how policies are developed and monitored. In Coal Economics & Energy Resource Markets Dorj Dolgorsuren argues that Mongolia now should search for ways to generate more revenues from coal exports to China, while Terry Surles points to the possibility that these same coal deposits may also be a rich source of profitable rare earth minerals. Relevant to all of these papers, in National Impacts and the Paradox of Resources Harald Fuhr provides a perspective on what is needed to avoid resources being a “curse” rather than a gift. In the last set of papers Dalaibuyan Byambajav, Yadamsuren Byambayar and Jochen Franzke examine how decisions affecting who will benefit from resource development are made in Mongolia and Germany at the most local levels.

Editor:
Dick Pratt, University of Hawai'i – Mānoa Honolulu, Hawai'i

Co-Editors:
Tsedev Damiran, National Academy of Governance, Ulaanbaatar, Mongolia
Charles Krusekopf, Royal Roads University, Victoria, British Columbia, Canada; American Center for Mongolian Studies
Dieter Wagner, University of Potsdam, Potsdam, Germany

Table of Contents and Brief Descriptions

I. General Background and Developments

II. Government's Role, Public Policies and Energy Pricing

  • Charles Krusekopf – State Ownership and the Development of Natural Resources in Mongolia (pdf). Mongolia has experienced the state ownership of mineral resources. The opportunities and conflicts created by this approach need to be examined, with consideration given to how Mongolia might better structure its ownership of natural resources for the benefit of all Mongolians.
  • Mark Glick – Supporting Hawaii's Clean Energy Transformation. Hawai'i is in a position to move well beyond its already ambitious goal of 40% renewables by the year 2030. If, and how, it is able to do this will provide lessons for other places looking for greater energy independence.
  • Maurice Kaya – The Hawaiian Islands: A Case Study of the Affect of Policies to Stimulate Investment in Green Energy Resources (pdf). The policy framework and legislated requirements to achieve Hawai'i's dramatic goals for natural energy substitution have been the basis for the remarkable transformation now taking place. Yet it is entirely possible policies intended to have broad benefits can result in disproportionate burden to certain populations.
  • Karl Jandoc and Michael Roberts – Balancing Opportunities and Costs in Hawai'i's Increasingly Green Grid (pdf). In Hawai'i the cost structure of the current electricity system and the potential benefits and challenges of growing the share of renewable energy are important issues. Variable pricing holds out the promise that all homes and businesses can be given an opportunity to buy and sell electricity at the marginal cost of generation.

III. Coal Economics & Energy Resource Markets

  • Dorj Dolgorsuren. – Mongolian Coking Coal Export Dynamics: Opportunities and Challenges (pdf). Coal exports offer options for quickly infusing money that can be used for development in Mongolia. Yet Chinese coal imports have been rising while Mongolian export shares are getting smaller and smaller. There is a need to institute measures that are the most suitable for remedying the situation.
  • Terry Surles – What Kinds of an Opportunity Are There For Rare Earth Materials Mongolia? (pdf). Rare earth elements are of growing importance in the modern world. Work done by the U.S. Geological Survey and Department of Energy has shown that rare earths are co-located with many coal resources. It is possible that rare earths can be economically recovered with coal at mines in Mongolia.
  • Tim Stuchtey – German Energy Security, Raw Materials Supply and Shifting Geopolitical Impacts. The dynamics of Germany's energy policies and energy security take place in the light of current domestic and external geopolitical developments as well as how recent international events may impact future strategies to secure energy resources and raw materials. 

 IV. National Impacts and the Paradox of Resources

V. Local Perspectives and Community Decision Making

Author Biographies

ALM, Robert
Robert (Robbie) Alm is the President of the Collaborative Leaders Network, an Omidyar Family Enterprise initiative designed to encourage more productive community dialogue and decision-making. Most recently he was Executive Vice President of Hawaiian Electric Company where his responsibilities included the transition of the Company to a clean energy future. Prior to joining Hawaiian Electric he was Executive Vice President of First Hawaiian Bank, Director of the State of Hawai'i Department of Commerce and Consumer Affairs, and on the staff of U.S. Senator Daniel K. Inouye. He is Chair of the boards of PBS Hawaii and of Enterprise Honolulu and serves on the boards of a number of other community organizations. He has a B.A. in political science from the University of Hawai'i at Manoa and a J.D. from the University of Iowa Law School.

BYAMBAJAV, Odgerel
Odgerel Byambajav completed her studies in business economics at Potsdam University in 2012. Since then she has been working as a member of the academic staff at Potsdam. This includes participation in an interdisciplinary network on market and technology oriented research at the Institute of Earth and Environmental Sciences. She supports science colleagues and students in starting their own business ventures at Potsdam Transfer, the Center for Entrepreneurship, Innovation, Knowledge and Technology Transfer. Since January 2015 she is a Ph.D. candidate at the Faculty of Economic and Social Sciences at the University of Potsdam. Her current research focuses on incentive systems to promote entrepreneurial behavior and culture at entrepreneurial universities.

BYAMBAJAV, Dalaibuyan
Byambajav Dalaibuyan is a Postdoctoral Research Fellow at the Centre for Social Responsibility in Mining (CSRM) within the Sustainable Minerals Institute of the University of Queensland, Australia. He obtained his Ph.D. at Hokkaido University, Japan, in 2012. His primary research interests are social and community aspects of resource development, agreement making, and sustainable resource governance. He is a lead researcher on a project examining the application of participation agreements between resource developers and host communities in developing country settings.

BYAMBAYAR, Yadamsuren
Byambayar Yadamsuren received his Ph.D. from the National Academy of Governance in 2013 and his MPA from the University of Hawai'i at Mānoa in 2008. Before becoming Chair of the Department of Public Administration at the National Academy of Governance in December 2013 he was an Associate Professor in the Department of Public Administration. His primary research interests are in local government reform in Mongolia.

DOLGORSUREN, Dorj
Dolgorsuren Dorj is an associate professor of economics at the National Academy of Governance. She received a Ph.D. in economics from the University of Hawai'i at Mānoa. Dr. Dolgorsuren uses game theory and experimental economics tools to analyze common pool resources, social dilemmas, public good provisions, social preferences, corruption, and mechanism design. She currently is teaching managerial economics and competition policy. She also has experience working in corporate governance of a state-owned enterprise.

FRANZKE, Jochen
Jochen Franzke has been a Professor of Public Administration at the University of Potsdam from 2008. Since 2005 has been Director of Study Group IV, "Local Governance and Democracy", of the European Group for Public Administration (EGPA) He has been a member of the board of the Institute of Local Government Studies, University of Potsdam sine 2012. Between 2008 and 2012 he was an honorary professor at the University of Humanistic Studies and Journalism in Poznań (Poland). Prof. Franzke is member of “The Network of Institutes and Schools of Public Administration in Central and Eastern Europe”. His research interests include the reform of public administration in Germany, particularly at the local and federal states level, the development of local democracy and governance, new forms of citizen's participation in planning processes and the transformation public administration in Central and Eastern Europe.

FUHR, Harald
Harald Fuhr has been a professor of International Politics at the University of Potsdam since 1997. He is trained as an economist and political scientist and is currently Director of several MA programs and coordinator of the Research Training Group on "Wicked Problems, Contested Administrations". Prior to his position in Potsdam he worked as Senior Public Management Specialist at the World Bank in Washington, D.C., and as Assistant Professor at the University of Konstanz, Germany.

GLICK, Mark
Mark Glick is Administrator of the Hawai'i State Energy Office, a post he has held since October 2011. As Administrator he leads Hawai'i's internationally regarded clean energy program and economic transformation efforts. Mark has been a leader in reducing vehicle emissions in the U.S. and abroad dating back to his service as senior advisor to the Texas Land Commissioner from 1987 to 1991 when he played a key role in passage of amendments to the Texas Clean Air Act and then similar provisions to the federal Clean Air Act Amendments of 1990.

JANDOC, Karl
Karl Jandoc is a Ph.D. candidate at the University of Hawai'i – Mānoa, Department of Economics. Prior to his graduate studies he worked as a consultant for the Asian Development Bank in Manila.

KAYA, Maurice
Maurice Kaya serves as Project Director for the Pacific International Center for High Technology Research. He currently directs the Energy Excelerator, a clean technology business accelerator that invests in promising business startups in the Hawaii market, a premier test-bed for advanced energy technologies. Mr. Kaya previously served as Chief Technology Officer for the Hawaii Department of Business, Economic Development and Tourism. In this position he was the principal advisor on clean energy to the governor of Hawai'i. Mr. Kaya currently serves as a board member of Energy Industries, a leading clean energy project integrator in the United States. He has been recognized with awards from the Governor of Hawai'i, the Hawai'i Legislature, the U.S. Secretary of Energy, the Blue Planet Foundation, and the Hawaii Institute of Public Affairs.

KRUSEKOPF, Charles
Charles Krusekopf has a Ph.D. in economics from the University of Washington and an M.A. in China Studies and International Relations from Johns Hopkins University School of Advanced International Studies. He is School Director and Professor, School of Business, Faculty of Management, Royal Roads University in Victoria, Canada. He also is the Executive Director of the American Center for Mongolian Studies (ACMS), which he founded in 2002. Dr. Krusekopf has been a visiting professor at the National University and School of Economics and Finance in Mongolia, and the University of Applied Science in Munich. He was awarded a Fulbright Fellowship in 2004.

MENDEE, Jargalsaikhan
Mendee Jargalsaikhan is Ph.D. candidate in political science at the University of British Columbia. Prior to this he was a Fellow at the Mongolian Institute for Strategic Studies, and served as Chief of the Foreign Cooperation Department of Mongolia's Ministry of Defense and Defense and Attaché at the Embassy of Mongolia in Washington, D.C. His research focuses on security and democracy of Northeast and Central Asia.

PRATT, Richard
Dick Pratt is Professor Emeritus at the University of Hawai'i at Manoa and founder of its Public Administration Program, a leadership program for public service. He is the Senior Adviser to the Dean of the College of Social Sciences on International and Community Programs. His teaching and research interests are in institutional change and the reform of public organizations, and effective public leadership. He has worked on diverse projects on projects in Mongolia, Thailand and Japan. Dr. Pratt has a Ph.D. from the University of Hawai'i at Mānoa in political science and has received honorary doctorates from the National Academy of Governance and Khon Kaen University in Thailand.

ROBERTS, Michael J.
Michael Roberts is Associate Professor in the Department of Economics and Sea Grant at the University of Hawai'i at Manoa. Co-Editor for the Journal of the Association of Environmental and Resource Economics and has served on editorial boards for several leading agricultural, environmental and resource economics journals. Dr. Roberts' research focuses on agricultural policy, impacts of climate change on agriculture, and commodity pricing. He recently began research on energy efficiency standards and electricity pricing, and hopes to do some work on water demand and pricing. Previously he was an Assistant and Associate Professor at North Carolina State University from Fall 2008 through Spring 2012. Prior to that he worked for USDA's Economic Research Service.

STUCHTEY, Tim
Tim Stuchtey studied economics at the University of Munster and completed his doctoral degree at the Technische Universität Berlin in the field of economic and infrastructure policy. He worked as personal advisor to the president of the Technische Universität before transferring to the economic policy office of the German Employers Association. In 2001 he moved to the Humboldt-Universität zu Berlin to become chief of staff of the office of the president. There he established the Humboldt Institution on Transatlantic Issues (HITI), a network of scholars working in the field of German-American relations. Beginning in 2007 he was Senior Fellow and Program Director Business and Economics of the American Institute for Contemporary German Studies (AICGS) at Johns Hopkins University in Washington, D.C. In 2010 he became Executive Director of the Brandenburg Institute for Society and Security in Potsdam that focuses on economic and social science aspects in homeland security.

SURLES, Terry
Terry Surles has had an extensive career in energy and environmental management and held numerous advising and consulting positions. He has been the Lead for Sustainable Energy and Environmental Solutions at the University of Hawai'i at Mānoa and serving as Senior Advisor to the California Institute for Energy and Environmental Solutions. He also is Senior Advisor to the California Institute for Energy and Environment. Prior positions include Vice President for the Desert Research Institute and Technology Integration Policy Analysis Program Manager at the Hawaii Natural Energy Institute focusing on grid integration. Dr. Surles received his Ph.D. in Analytical Chemistry from Michigan State University. He work includes more than 250 publications, technical reports, and presentations. He has served on a number of committees, including appointments with the National Academy of Sciences. He continues that service for government agencies, including the U.S. Department of Energy and the National Renewable Energy Laboratory.

TSEDEV, Damiran
Tsedev Damiran is currently Dean of the School of Public Affairs and Management, National Academy of Governance. Prior to this he served in various positions at the Academy, including Vice Rector, Head of the Training Division, and Director of the Public Administration Program. He was a Scholar in Residence at the University of Hawai'i at Mānoa. His publications have appeared in journals such as The Asia Pacific Journals of Public Administration. His current research interests focus on democratization, post-Communist transition and transitional governance. He holds a Ph.D. from Ural State University in Russia.

WAGNER, Dieter
Dieter Wagner, University of Potsdam, was formerly the Director of Potsdam Transfer, Vice President for Knowledge and Technology Transfer, dean of Faculty of Economics and Social Sciences and Professor of Management. His current research focuses on entrepreneurship and technology transfer, flexibility in human resource systems, and entrepreneurship culture and entrepreneurial universities.