Reason-able Answer to Energy Woes

It's an apology for the Saudis and Big Oil, and a reminder that calling right-wing reactionary blather "Reason" does not make it so.

 

That was very much a propaganda piece.

 

OK.
1) No mention of the very big reduction of oil consumption that followed the 1970's oil embargo (during Jimmy Carter's administration). Yet he just states that "....U.S. was a net crude oil importer [as early as] 1913...". (In other words, the US actually was heading in the direction he states as impossible.)

2) He lumps everyone looking for sustainable options as one group. Note the following quote: "....they love biofuels. We can just grow the fuels we need to replace imported oil and it will be great for farmers and the rural economy. Third, [energy independence proponents] conflate oil and terrorism." (A lot of individuals, including me, do not love biofuels...and I know the difference between terrorism and oil....like 99% of everyone else interested in sustainable energy.)

3) The paragraph on the "Jevon's Paradox" is nutty. He states that energy efficiency improvements increase electical demand. (So all those folks who want to reduce their electrical bill need to by more inefficient appliances???)

4) How about this whopper: "But an incurable problem for both solar and wind is intermittency." Note that NINE solar plants have been running in the southwest for up to 15 YEARS with the intermittency problem solved.

There are more, but I've shown my point.

 

Hi All,

Not this "Jevon's Paradox" thing again. There is significant non-similiarity between the change from Coal Ships changing to Oil Ships in the 1800's with the present situation. For one, almost every family in the modern world is using as much energy as one of these ships did in a year, in a month or so. So, the playing field is not large enough to be considered infinite. There is nothing else to dig/pump out of the ground to replace oil, like oil replaced coal.

One could also ask without a penny of subsidy to oil and roads, how many people would be driving cars in the US ? Can we phase out oil subsidies?

I seem to remember some article which had a chart that showed the US dropping its gas consumption during the 80's and 90's to the effect that gasoline prices were remarkably inexpensive. Then rather than take advantage of this, some greedy Car companies decided to market the off-road vehicle as the new suburban cruiser.

We need to get back to the vehicle economy that had OPEC on the run. We need to get in that situation again. And this baloney about not even trying, is just wrong. Look what happened when the front-wheel drive car took over from the rear-drive car. Apterra like cars could have this same effect this time around.

 

Well, he has "3,000 kilowatts of solar panels" on his roof! I kind of doubt that.

Seriously though, I agree with most of his points with regard to the rather limited political value and negative economic value of "energy independence". I'm more interested in carbon independence. I also agree with his description of the whole ethanol-from-corn scam. That whole thing is criminal.

His dismissal of peak oil is curious. We're already experiencing the front end of peak oil, and so a savvy business person would be investing in large-scale (or maybe even small scale) alternative energy. The government also has a role in investing in basic and applied research in this area. Peak oil combined with global warming will make it the next big thing.

I do think a little along the lines of "Americanism" (related to the "isolationism" and "protectionism" terms he derides), in that I believe the U.S. should be on the forefront in this area. Right now we're the laggards.

 

Some of his points have validity, but surrounding them with distortions really makes a convincing message impossible. It is clear than anyone claiming that we can achieve energy independence via biofuel cannot add or subtract. It is also true that a lot of legislation and subsidies are destructive. However, this does not automatically mean energy independence is impossible or that smarter legislation is impossible.

Likewise, there will be a day when oil "independence" is forced upon us. We can prepare for it or we can ignore it. Leaving it to entirely to the market is irresponsible since markets will collapse with no regulation. (Think 1929 Stock Market Collapse, or Enron). Leaving it entirely to a government department can be just as bad. Sustainability is a very hard problem, but not a totally impossible problem.

 

I agree! Especially the last part. Unfettered Free markets are not the solution. A combination of markets, strictly enforced laws and education of the people is the solution. Without education and enforcable rules markets will exploit in any way they can without regard to the future. To argue against this is to forget the entire history of markets. lol

I'll praise markets more when they start using true accounting methods which include EVERY aspect of extraction, production, shipping, marketing, recycling/reclaimation, workers rights/health, energy, emissions, etc.

 

Newborns need care and feeding before they can face the cold, cruel world. Subsidies make sense to get new things started in an existing, hostile, highly competitive environment. Subsidies must of course always be temporary.

Solar is a great example of where subsidies have worked in Japan and Germany. They are both way ahead of us in installed solar. In Japan the cost of solar has gone down by more than 70% since they started the subsidies mainly through volume, and now they are beginning to roll the subsidies back as solar has become competitive.

You are correct that subsidies can be misused and misapplied in a political environment. There a billions of dollars in subsidies to the oil companies (of all things!) in the US in the form of tax breaks.

Lastly, the idea I seem to hear a lot that "the free market" with the government just "getting out of the way" will solve all of our problems is not borne out by history.

In fact the idea that we even have a "free market" is sidestepping somewhat the reality. The only free market I know of on the industrial scale is the illegal drug trade. I can't say that that's my model of how customers, suppliers, middle men, monopolies, quality control, etc. should be handled. Our "free" market is the result of a very complex set of government regulations designed to make it fair, transparent, and safe for all involved.

 

Sorry if this is too long. Hit a sore spot.

The problem I see with that is the the market tends to be reactive (people react to current prices), whereas government, if done right, could be proactive (foresee trends that will be forced on us & prepare for it).

Yep. Get rid of the subsidies that oil and coal have had for years, make them pay for a share of respiratory ailments, and that will be a starting point. Otherwise the only way to level the field is to have a subsidy for alternative energy (meager as it is currently, a mere fraction of coal liquefaction and other government subsidies).

Somewhat true. Jevons paradox came from the observation that increased efficiency of coal in steam-engine trains made travel affordable, and thus more people travelled and more goods were shipped, increasing the amount of work done, but not decreasing the amount of coal used. Also, people who bring up Jevons' prediction that England would run out of coal tend to fail to mention the fact that Jevons was looking one century in the future - and that he was correct. Almost exactly a century later, England was a net importer of coal. Luckily that wasn't a driving force of the economy by that point.

So the question is, should we encourage people to commute one person per SUV to an office job, or use the oil that could be saved to do other things, like protect national security, explore space, or preserve for future generations?

Some 'greenies' like me view true efficiency more as gallons per month (gpm) not miles per gallon (mpg). My gpm has gone from 48 to 12 in 5 years. You can say somebody else is taking what I'm saving, but if it means fertilizing a field in India and indoor plumbing in China, I guess I'll just have to live with that. I don't really miss having a long commute in a station wagon. But we need to have viable options available to people to make those decisions.

And of course, this all assumes the supply of oil remains constant or increasing. Evidence is not supporting that. OPEC announced a minor cut in production recently. Doesn't this alarm people? Wasn't it just 5 years ago that they said they didn't want prices to go above $35/barrel because people would invest in alternatives and the demand would go down? Now at $100/barrel they come up with excuses as to why they shouldn't increase production...it seems fishy to me.

We moved beyond whale oil because there were better alternatives, and it was probably getting harder to hunt whales. It's getting harder to hunt for oil, but we don't have better alternatives at the scale needed. It's the 800 pound gorilla most people are ignoring.

I'll agree with that. Although the rate of growth is slowing, but not fast enough to help us this century.

That must be generation only, not transmission and distribution. The numbers I see from a year ago are $0.05 per kWh for coal, $0.12 for nuclear, $0.08 for hydro and $0.15-$0.20 for solar (not sure if that's photovoltaic or solar thermal). Wind is $0.05 per kWh. But coal cost does not include loss of productivity due to asthma or carbon output. Solar, wind geothermal can be created now using relatively cheap oil to produce the plants, then when oil and natural gas prices increase in the future, we'll be glad we spent the money now.

The market (average person) does not decide what kind of elecriticity they'll use, that's decided at a corporate and governmental level. The market is a consideration but never the only force in these decisions.

As for the basic premise of energy independence, I don't see that as the same as isolationism. Only if we slap on tariffs and such. Ironically, the only place we do that is with ethanol, so we don't flood our market with cheaper Brazilian ethanol. (We also protect our sugar producers from Latin American sugar). We'll still be in a global marketplace for our finished goods and services. The author mentioned various raw materials that we import 100%, but he neglected to mention anything that we do not import. I don't have examples, but I am sure they can be found the same way he found yttrium and fluorspar. Oil imports may have started in 1913, but even by 1970 we only imported 12% of oil we used. Today we import 2/3 of our oil. What happened? In 1970 our oil production peaked. It caught people off-guard, despite Hubbard's predictions, setting us up for the oil shocks in the 70's. Do we want to be caught off guard again, this time globally?

 

"To place some of the alternative energy schemes in perspective: A nuclear plant can produce electricity at about $0.03 per kw/h (including disposal fees,) coal at a bit less, while solar is still striving to get down to $0.07, with subsidies."

That's a worthless comparison.
What's the cost of dealing with nuclear waste? We don't know! We haven't figured that out yet, so we don't count it as a cost! (Note: I'm not anti-nuclear either, but to say it's substantially cheaper is BS.

What's the cost of dealing with mercury in the air and water and the rising CO2 levels we get from burning coal? Same problem as nuclear. We haven't done it yet. The cost of coal is the cost to just burn it, take the energy, and THAT's IT!

How does the cost of solar get calculated anyway's? Once it's built, the cost is near ZERO. Is that the cost to build and set it up for 1 year of production? 5 years? There is NO feedstock to continue to buy or fight wars over. At least until the world reaches peak silicon, anyways.

We're going to need a basket approach including nuclear and coal as base power and solar, wind, etc for as much as we can feasably use it for (50/50?). And ground transport has to be a mix of biodiesel and electric, depending on the application. Electric tractors make no sense and biodiesel cars for a 5 minute commute doesn't either.

To argue against one part of the solution because it can't do EVERYTHING, or because the cost can't compete with ENTRENCHED business interests is stupid. It only delays the change we need and makes the change harder to make when it's FORCED upon us. Imagine building up the solar, wind, and biofuel infrastructure at $10 bucks a gallon or while dealing with fuel shortages accross the country.

 

I think the point Darwood is making is that you are still not accounting for the degadation of health and environment. This is something more and more economists are starting to factor in but has been neglected wholesale in nearly all reports over the last century.

 

There was a Homepower magazine article several years back about a residential PV installation in the desert east of San Diego. The payback period for the installation was something like 2-3 years. Impossible you say? Well, the PV power was replacing grid power at $0.57 per kWh. The cost schedule for grid power was multi-tier, something like $0.20 for the first amount, $0.35 for the next, and $0.57 for anything beyond the first 2. The lowest price was calculated to allow operation of a normal house without electric heating or air conditioning. The air conditioner drove the usage way into the third pricing tier.

Another price that I've heard of for electricity was $0.03 per kWh. That was right next to a major hydro station in the northwest. It's probably gone up since then, like to $0.05.

The cost effectiveness of solar electric is clearly different with $0.57 power than it is with $0.03 power. Major hydro is clearly the most cost-effective way to generate power. The biggest problem is that there aren't any more places to install it. Wind and ocean waves look to me like the most underutilized power sources. You could certainly run Chicago off of North Dakota wind.

Production costs are only half of the equation. Consumers react to the delivered price, which is only loosely related to production cost. Back in 2000 when Enron was raking California over the coals it was abundantly obvious that production cost was almost irrelevant. When Enron constructed a 1% shortage, the sales price doubled or tripled. Power generators made more money by shutting down a plant than they would have by selling the power that the plant produced. Several local cities with their own power departments were unaffected since they had long time contracts in place. The larger utilities that purchased power on the spot market actually went bankrupt. Just ask the people in Pendleton, Oregon about electricity. An aluminum factory near there closed because Los Angeles was willing to pay more for the power than the aluminum factory. Same production facility, different market conditions.

 

Many experts say all the fixes are mear bandaids:

The Long Emergency : Rolling Stone

and its likely to be way closer than you think. Imaginge this article talking about less than 3 years ago, oil going up to $50 a barrel, and now look ... double. So guess where we'll be in 3 more years.

 

I wouldn't call Kunstler as part of "many experts".
I do read his blog weekly and he makes good points. But then he basically says were all doomed as his conclusion. He's constantly predicting the bottom will fall out of the stock market and he's constantly wrong. He paints the picture of the glass being not only half empty, but almost empty and full of cracks. Maybe he does this to sell books, maybe he does it to give the public the swift kick in the pants it sorely needs, I don't know. I just don't think holding a sign that says "the End is Near!" helps much, and that's seems to be his consistant message.
There are solutions, just not solutions that allows the western world to continue a "quality of life" defined by excess consumption. And those solutions have to be looked at as parts of a whole plan, not as individual solutions to giant challenge we face.

The best point he made in the article you linked to was the point that renewables REQUIRE the existing oil infrastructure to produce. I've been trying to make this point for years. If we don't plan ahead for the depletion of oil, we will face a "greater depression" and this is why the "free market" would completely fail mankind. The free market would wait until it's too late to switch to renewables, since the renewables can't compete economically with the entrenched (and subsidized) energy infrastructure we have now. It is very important that we use government to push ahead the move to renewables so they can be developed while the current oil infrastructure is still operating. As the cost of oil rises exponentially, so does the cost of the solutions to replacing it. Even under Bush, this message is starting to become more accepted in the nation's psyche and the next president will be in charge of accelerating the move. Accepting the situation and supporting alternatives are now at hand and will really take off over the next 5-10 years. However, the complete reality has not sunken in though, that half the challenge is to reduce consumption. Most Americans have only come around to the thought that "we need to change" but not to the thought that "I need to change".

 

We're up to $0.065 per kWh now.