Offshore Sea Resource Development:
A Spur to Onshore Land Speculation
[A paper presented at the 13th International
Conference on Land Value
Taxation and Free Trade. Douglas, Isle of Man. September 1973]
Until recently the oceans, the connected mass of waters which
comprise 71 per cent of the earth's surface, have been a relatively
free good. The nations have disputed sovereignty over the waters
contiguous to their coasts, and jurisdiction is claimed three,
twenty-five, fifty, one hundred and even two hundred miles offshore,
while empires have asserted for a time hegemony over vast sections of
them. But the ordinary citizen could make a living by fishing or
transporting people and goods over the ocean without interference from
the government or exploitation by it.
This situation is changing rapidly. Heedless and unlimited
exploitation by ruthless corporations, conflict between national
interests and other pressures, has brought about, in many countries,
regulation and licensing. A way of life that was hard but so free that
it attracted men and women of noble character and adventurous bent is
passing. It will be gone soon for technology is sounding its doom.
Technological advance is often a clear response to pressing needs. It
is so in this case. No doubt part of the energy crisis in the United
States and certain other countries has been manufactured by
monopolists, such as the oil producers and the utilities interests.
But it is a fact that economic boom, wasteful use, a tax system that
fails to allocate resource lands according to their most efficient use
and other factors have led to depletion of the richer sources of the
energy resources of the United States.
This has put a premium on the development of new energy sources. But
this is not the only shortage with which the country has to contend.
There is a shortage of food in relation to the demand backed by
purchasing power, and hence food prices have risen. This comes at a
time when nations in the Soviet bloc, and nations in the Communist
Chinese orbit, suffered crop disasters from unfavorable growing
weather. This also came at a time when recovery and boom in a number
of countries made it possible for people to improve their diets. The
world, however, and particularly the United States, has more than a
fuel and a food shortage. There is also a water shortage. In the
United States it is produced by technology: the use of water in
industry, in improving the amenities of life by air conditioning, by
the spread of water systems making its use attractive to and available
to more people, and other developments. In other countries it is
produced by climatic factors and in all countries environmental
changes, such as urbanization, road-building and forest exploitation,
play an important role.
In the face of the fuel, food and water shortages, the advanced
industrial nations are turning to the oceans. Many nations are engaged
in oceanic exploitation; this paper will be limited to efforts by the
United States, and not in better known areas such as offshore oil
exploration and exploitation but in an area that is less well known:
development of offshore solar power combined with desalinization
plants and mariculture tanks. This is an area of tremendous promise,
but much of the promise may not be realized unless we act quickly to
prevent land speculation from running up costs.
Those who will enrich themselves from the solar sea power concept are
not its discoverers. We owe it to the French physicist, Jacques
D'Arsonval, who reported it to the scientific community in 1881. It is
based on the fact that more than 70 per cent of solar radiation falls
upon the oceans. In the tropics the sun's heat keeps the ocean's
surface temperature at 25 degrees centigrade. The warm water from the
tropics moves toward the North and South Poles, and is a major factor
in melting the ice. Cold water at the poles slides into ocean depths
and moves toward the equator. In the tropics this cold water in the
depths, moving beneath the warm water at the surface, provides a heat
sink from 25 to 5 degrees centigrade at a depth of only 1,000 metres.
This is an infinite phenomenon since both the warm water at the
surface and the cold water at the 1 ,000-meter depth are replenished
by solar radiation. Hilbert Anderson and James Anderson of York,
Pennsylvania, proposed in 1964 that this ocean thermal gradient be
used to operate a power plant submerged to a depth of 100 to 200 feet.
They and others proposed a design in which the 25 degree hot water
would flow through a heat exchanger in no greater amount than a
hydroelectric plant with the same output, causing another fluid, the
working fluid, to boil. The vapor of the low boiling point fluid would
expand through a turbine to generate electricity and then be condensed
back to a liquid for re-use in a condenser cooled by the cold ocean
water. Ammonia, freon or propane have been used in recent heat
exchanger experiments, but the model with which George Claude
successfully produced electricity in Cuba in 1929 used only sea
Efforts to make the thermal gradient power plant more efficient are
not limited to improvement of the working fluid. Anderson and Anderson
also proposed that the power plant produce fresh water by removing
dissolved gases from the warm water flow, vaporizing it in a vacuum
evaporator and condensing the vapor by the cold water flow. They
estimate that a 100 million watt plant could produce 60 million
gallons of fresh water daily.
Experiments are also going on to combine with the production of power
the production of hydrogen and oxygen through the electrolysis of
water. It may be cheaper to transmit power to shore through a hydrogen
pipeline than through cables.
Still another development is based on the knowledge that natural
upwellings of cold water from ocean depths are sites extraordinarily
rich in marine life, such as unicellular algae. One such, off Peru,
accounts for almost one-fifth of the world's fish harvest. Experiments
in the Virgin Islands have demonstrated that when such water is fed
into tanks, shellfish such as clams, oysters and scallops can be
cultivated, at a rate faster than in nature. Cull shellfish can be
used as feed for lobsters, shrimp and other crustaceans, which,
experiments show, grow at a much accelerated rate in these tanks. This
food production at an onshore site contiguous to the offshore plant is
called mariculture. It is estimated that the annual yield of shellfish
alone would be $50,000 an acre ($125,000 a hectare).
Such a development, it is estimated, would be economically viable in
Florida, where the Gulf Stream hugs the coast from Jacksonville south
to the Florida Keys. A team at the University of Massachusetts is
preparing designs for a submerged plant to produce power from the Gulf
Stream. The first site proposed for testing the concept is about 25
kilometers from Miami. But already Jacksonville is estimating the
effects of such onshore and offshore ocean development in terms of
employment, investment, tax revenues, population increase and land
values. Anderson and Anderson have estimated that the Gulf Stream's
thermal gradients could generate 182 billion kilowatts, which is 75
times the expected US demand in 1980.
William D. Metz, reviewing the experimentation now in progress in
Science, the weekly journal of the American Association for
the Advancement of Science, remarks sagely that "solar power from
the sea may well turn out to be a source of clean energy that has been
overlooked for too long. " But it must be pointed out that
even if the federal government of the United States of America asserts
its sovereignty over the ocean sites, combined development will
require the use of contiguous onshore sites. This is appreciated not
only in Jacksonville but along the shore southward. Jacksonville
residents are pointing to the rise in land values in central Florida
to astronomical levels -- on the order of from $1,500 to $55,000 an
acre and higher -- as a significant precedent. Of course,
transmission technology should limit the possibilities of development
in the early stages. Even so, the possibilities are enormous. If
Florida employed land value taxation, the gains in value of the
contiguous onshore sites could be recaptured for the benefit of all
Florida residents. In the absence of this, the franchise fees exacted
by the federal government for the use of the offshore sites could be
used to recapture a substantial amount of the profit for the benefit
of all United States residents. The onshore sites would generate not
merely economic rent but monopoly rent; if the annual franchise fee
were high enough, it would serve to moderate the rise in onshore land
values, for the monopoly exaction would be shared by the offshore and
onshore sites and the onshore site owners could only claim what was
left after the federal treasury received its due.
But the federal government has not yet shown that it appreciates, in
this situation, the advantage to all except speculative land owners of
the total appropriation of the rent generated by power, water,
chemical and mariculture development. Those who do appreciate this
should seek to make their studies available to the policymaking bodies
in the federal and the relevant state governments. Since such thermal
gradients are available in many other countries, students of the
taxation of land values and the social appropriation of rent would be
well advised to consider studies of the application of their positions
with respect to franchise fees and land value taxes applied to the
exploitation of this ocean resource.
- William D. Metz, "Ocean Temperature Gradients; Solar Power
from the Sea," Science, Washington, D.C., Vol. 180
(June 22, 1973), p. 1266 ff.
- Ibid.., p. 1266.
- Oswald Roels of Columbia University's Lamont-Doherty Geological
Observatory, quoted by Metz, op. cit.
- Op. cit., p. 1267.
- Personal communications from Jacksonville residents.