Energy Politics & Science

[Body-by-Guinness]

Which Is Greener?

Posted by Randal O'Toole

Which uses less energy and emits less pollution: a train, a bus, or a car? Advocates of rail transportation rely on the public’s willingness to take for granted the assumption that trains — whether light rail, subways, or high-speed intercity rail — are the most energy-efficient and cleanest forms of transportation. But there is plenty of evidence that this is far from true.

Rail advocates often reason like this: the average car has 1.1 people in it. Compare the BTUs or carbon emissions per passenger mile with those from a full train, and the train wins hands down.

The problem with such hypothetical examples is that the numbers are always wrong. As a recent study from the University of California (Davis) notes, the load factors are critical.

The average commuter car has 1.1 people, but even during rush hour most of the vehicles on the road are not transporting commuters. When counting all trips, the average is 1.6, and a little higher (1.7) for light trucks (pick ups, full-sized vans, and SUVs).

On the other hand, the trains are rarely full, yet they operate all day long (while your car runs only when it has someone in it who wants to go somewhere). According to the National Transit Database, in 2007 the average American subway car had 25 people in it (against a theoretical capacity of 150); the average light-rail car had 24 people (capacity 170); the average commuter-rail car had 37 people (capacity 165); and the average bus had 11 (capacity 64). In other words, our transit systems operate at about one-sixth of capacity. Even an SUV averaging 1.7 people does better than that.

When Amtrak compares its fuel economy with automobiles (see p. 19), it relies on Department of Energy data that presumes 1.6 people per car (see tables 2.13 for cars and 2.14 for Amtrak). But another Department of Energy report points out that cars in intercity travel tend to be more fully loaded — the average turns out to be 2.4 people.

“Intercity auto trips tend to [have] higher-than-average vehicle occupancy rates,” says the DOE. “On average, they are as energy-efficient as rail intercity trips.” Moreover, the report adds, “if passenger rail competes for modal share by moving to high speed service, its energy efficiency should be reduced somewhat — making overall energy savings even more problematic.”

Projections that high-speed rail will be energy-efficient assume high load factors (in the linked case, 70 percent). But with some of the routes in the Obama high-speed rail plan terminating in such relatively small cities as Eugene, Oregon; Mobile, Alabama; and Portland, Maine, load factors will often be much lower.

Even if a particular rail proposal did save a little energy in year-to-year operations, studies show that the energy cost of constructing rail lines dwarfs any annual savings. The environmental impact statement for a Portland, Oregon light-rail line found it would take 171 years of annual energy savings to repay the energy cost of construction (they built it anyway).

Public transit buses tend to be some the least energy-efficient vehicles around because agencies tend to buy really big buses (why not? The feds pay for them), and they run around empty much of the time. But private intercity buses are some of the most energy efficient vehicles because the private operators have an incentive to fill them up. A study commissioned by the American Bus Association found that intercity buses use little more than a third as much energy per passenger mile as Amtrak. (The source may seem self-serving, but DOE data estimate intercity buses are even more efficient than that–compare table 2.12 with intercity bus passenger miles in this table).

When it comes to energy consumption per passenger mile, the real waste is generated by public transit agencies and Amtrak. Instead of trying to fill seats, they are politically driven to provide service to all taxpayers, regardless of population density or demand. One of Amtrak’s unheralded high-speed (110-mph) rail lines is between Chicago and Detroit, but it carries so few people that Amtrak loses $84 per passenger (compared with an average of $37 for other short-distance corridors).

Meanwhile, transit agencies build light-rail lines to wealthy suburbs with three cars in every garage. With capacities of more than 170, the average light-rail car in Baltimore and Denver carries less than 15 people, while San Jose’s carries 16. For that we need to spend $40 million a mile on track and $3 million per railcar (vs. $300,000 for a bus)?

If we really wanted to save energy, we would privatize transit, privatize Amtrak, and sell highways to private entrepreneurs who would have an incentive to reduce the congestion that wastes nearly 3 billion gallons of fuel each year (p. 1). But of course, the real goal of the rail people is not to save energy but to reshape American lifestyles. They just can’t stand to see people enjoying the freedom of being able to go where they want, when they want to get there.

http://www.cato-at-liberty.org/2009/06/08/which-is-greener/

[JDN]

Body by Guinness; let's try again, somehow we got off (and stayed off) on the wrong foot.

I am not looking to argue, just seeking your opinion.

Trains/Rail transit.

I am not arguing with the issue of fuel efficiency; I understand your point about "empty" trains.
And I am not defending boondoggles; for example they are proposing a high speed train from LA to Vegas,
but I don't gamble much, so I don't care.

But...  I do find trains rather efficient.  Privatize them, fine; maybe they will run on time. Raise the price; fine, but...
As I travel in America to SF, NY, or Chicago, I find rails a pleasant way to go.  And as I travel to
London, Paris or Tokyo I keep thinking I wish we had a vast rail rail system here in LA. 

As population grows, density grows, therefore don't you think rail and bus to be efficient?  I know people in LA who
spend and hour commute+ each way by car.  And we can widen the freeways only so much and build only
so many new roads.  Rather inefficient I would say, not to mention wasted time and
energy.  And intangible costs include accidents, etc.

What are your thoughts?  Why oppose new rail lines?

[Crafty_Dog]

Before BBG gets to this, if I may respond as an Angeleno who was born and raised in NYC?

Los Angeles is a reallly, really spread out area.  To use a train of some sort means having to get to the train station and having to do something to get to one's actual destination after getting off the train at the other end.  Bottom line, the trains lose money.  LOTS of money.  Rail does not make sense-- but it does cost billions and billions of dollars, not that we have gotten around yet to paying for it , , , 

Not speaking from specific knowledge, but my sense of things is that the city's bus system is an economic clusterfcuk.  Yet for some strange reason (e.g. public union objections  ) the city vociferously opposes jitneys.

Even in the Boston-NY-Philadelphia-DC corredor, AMTRAK is a multi-billion dollar annual drain on the public coffers , , , what a bargain price for having gotten Joe Biden from home to the Senate all these years , , ,

DC's metro train system was built with the taxes of the nation.  Why?

[JDN]

I understand your point.

And yes, LA is spread out, but for example my brother lives in Canyon Country (an hour drive) and his wife is a VP at a bank downtown; she takes the Metro Link and loves it.

And yes, the bus system is a clusterfuk.  I've tried it a few times; I don't think they know what "on time" means.  IF they even show up.

But it does work in other cities.  SF for example has BART; people seem to like it.  As for NY a friend I stayed with lives in CN and takes the train
everyday in to Manhattan.  He too loves it.  But I also agree AMTRAK seems like a clusterfuk.  But as to why, I don't know. In theory it seems to me it
should have potential.  And if you have visited Japan, well, the train and bus system is fabulous.  One time the bus driver actually apologized to everyone on
board for being 5 minutes late.    I wish that was the issue in LA.

And you know LA; we can't just keep adding people and cars; every year traffic has gotten worse and worse.  Something ? needs to be done...

[Body-by-Guinness]

Body by Guinness; let's try again, somehow we got off (and stayed off) on the wrong foot.

Wrong foot had little to do with it. Circular arguments did.

I use to teach a Thai Boxing class on a college campus. We'd get a lot of traditional martial artists showing up to check us out, and ran an open mat after class, so I'd get to spar with these guys, guys who wanted to show us upstarts up. Traditional guys' technique tends to have more snap that power, are rarely tested against the real world, and have an ingrained point scoring ethic that skews its application and so on. I'm an old, fat guy, but without exception I'd drop these college kids to the mat.

Interesting conversations would ensue. In Thai Boxing you seek to conserve energy, so a parry that causes a blow to brush past your face was considered a good parry. Some guy I had smacked down would say "I hit you as often as you hit me." Well yes, except I parried effectively, and he didn't so he got his a$$ sat down. Alas touching someone's head was a counted in his point scoring art so he'd pretend some sort of victory. Or I'd block some high, snappy kick and then take out the down leg, only to be informed it was against the rules to do so. Not in Thai Boxing, I'd reply.

Bottom line is I'd get to have a lot of circular discussion with folks who would equivocate about the blows they landed and make inane arguments about why this or that should be disallowed. But hey, I'd get to work on my game, had the satisfaction of watching them form their arguments with bloody lips, and wouldn't have to do a second lap around the same track with them as one beat down was enough and they wouldn't show up again for a second try.

Needless to say I see a lot of parallels where our exchanges are concerned, save for the fact that sparring with you doesn't improve my game, I see little evidence that the blows I land changes yours, and no matter how many times your a$$ is owned you're back at it using the same techniques the next day. Bottom line: I derive no benefit from sparring with you, so it's pretty stupid to continue doing so, yes?

I am not arguing with the issue of fuel efficiency; I understand your point about "empty" trains.
And I am not defending boondoggles; for example they are proposing a high speed train from LA to Vegas,
but I don't gamble much, so I don't care.

Wrong pronoun, it's not my argument, it's the authors. I like to post heterodox pieces that challenge conventional wisdom and certainly haven't researched the issue to the point I feel qualified to pretend expertise.

But...  I do find trains rather efficient.  Privatize them, fine; maybe they will run on time. Raise the price; fine, but...
As I travel in America to SF, NY, or Chicago, I find rails a pleasant way to go.  And as I travel to
London, Paris or Tokyo I keep thinking I wish we had a vast rail rail system here in LA.

 

Anecdote isn't an argument. The author lists specific reasons why efficiency figures are not to be believed. If we are to make cogent arguments as to why we should have a rail system as cosmopolitan as you cite, then good numbers would seem a prerequisite. Please note here that you veer away from the point of the piece, and slip in an urbane bon mot, habits that consistently emerge in other exchanges and that have little to do with framing a cogent response.

As population grows, density grows, therefore don't you think rail and bus to be efficient?  I know people in LA who
spend and hour commute+ each way by car.  And we can widen the freeways only so much and build only
so many new roads.  Rather inefficient I would say, not to mention wasted time and
energy.  And intangible costs include accidents, etc.

Again the piece is about how the current debate is based on fallacious numbers, the sort of fallacious numbers people who feel they should be able to tell others how to live then use to limit choices and force policy change congruent to their political ends. If an argument is a good one, why do bad figures have to be bandied to make the sale?

What are your thoughts?  Why oppose new rail lines?

I don't oppose them, though I do oppose public monies being spent on dubious projects based on faulty numbers. Is one allowed to favor solutions based on the empiric rather than the political? Or is framing a sunny ideal and then daring someone to take issue with it all that's required?

[JDN]

I too derive no benefit from sparring with you; as you said, you are "an old, fat guy.".
But maybe the students on your campus felt the same way?  We both have tried to be polite and respectful to you, but
to no avail.  And you are right, "the blows you land" have little affect.  So why do you insist upon continuing to spar?

In contrast, in the spirit of conciliation and rapprochement, I tried appeasement and a little humor in my opening sentence. 
I agree it is "pretty stupid to continue" sparing with you; rather I would simply prefer that you stay at the lectern and
offer your thoughts on the subject without a direct and personal repoiste. I think most on this forum would agree.

Yet, after all this time, and reprimands, you still seem to find that difficult to do?  Here you provided a lengthy personal response that primarily addresses me
rather than the thought on the table.  Why?  Oh never mind.  But perhaps it might be better to address the issues rather than attack the messenger?

And I admit I mistook your posting as your personal position or at minimum, one of interest to you; not simply a "challenge to conventional wisdom";
that is why I "veered away from the point of the piece" and asked your thoughts.  You do seem like a bright fellow, so I hoped you would address the big picture
(public transportation) beyond the confines of this narrow piece on why efficiency figures are not to be believed.

[Body-by-Guinness]

Sure thing, JDN, and my mom wears combat boots, too.

And who's this "we" you're referring to? Have a mouse in your pocket or is this another royal "we" where you try to claim some sort of tangential authority by dropping an irrelevant tale about some mover and shaker you shared a salad fork with? Indeed, that's one of the three rhetorical devices you seem to have a handle on: the inanity hammer, where you keep recapitulating a point already well disputed as though reiteration somehow trumps all. Then there's facile deconstruction, where you cast someone you're arguing with as a caricature, usually a conservative Republican, and then find some element of that doctrine that is not congruent, as you see it, with the matter at hand. And then there are the imperious associations already mentioned where you insert your self importance as as though it was an argument unto itself.

So you present a "rapprochement" as you embrace the same tools and think I should be gracious about the repackaging effort. Sheesh, what self delusion. I very much doubt you are aware of the water in which you swim and expect if an epiphany ever occurred you'd find yourself drowning amid your own synapses. You might want to reflect on how to allow people you engage to have choices other than smiling and nodding at your damn foolishness or escalating things until scathing rebukes are all that's left.

Be that as it may, I'll post what I want, when I want, and engage who I want regardless of any sputtering you do. For the record, the folks who left the Thai Boxing class weren't my students, but rather folks who thought they were going to school me. My students stayed and became better martial artists. The folks who left did so with their self delusions intact and perhaps became better within their traditional structure, but certainly did no growing outside that comfort zone. There are lessons to draw there. You are incapable of doing so.

I'll leave you with a little sketch that comes to mind when one of your circlar loops becomes particularly protracted.

[youtube]http://www.youtube.com/watch?v=zKhEw7nD9C4[/youtube]

[Body-by-Guinness]

Climate change vote: Pelosi’s green gamble
By Jared Allen and Molly K. Hooper
Posted: 06/23/09 08:35 PM [ET]
Speaker Nancy Pelosi (D-Calif.) is moving forward with a floor vote on climate change legislation this week even though many Democrats are undecided on the controversial bill.

Pelosi’s gamble to schedule a Friday vote is one of the riskiest moves she has made as Speaker. There are at least eight Democrats who are firm “no” votes, while many others are on the fence (see chart page 14).

In an indication that Democrats lack the necessary votes to pass it on their side of the aisle, Pelosi and other party leaders have met with centrist Republicans seeking their support.

Pelosi and Majority Leader Steny Hoyer (D-Md.) — in coordination with the White House — decided on Monday night to file the bill with the Rules Committee. That surprise move has set up a vote-counting showdown by the end of the week.

Democratic aides said leaders had been building up to this decision as they monitored negotiations between Energy and Commerce Committee Chairman Henry Waxman (D-Calif.) and House Agriculture Committee Chairman Collin Peterson (D-Minn.) over the weekend.

At press time, Waxman and Peterson emerged from a meeting with the Blue Dog Coalition and announced that they reached an agreement.

“We have something that I think works for agriculture,” Peterson said.

The crux of the deal is a concession from Waxman to allow the Department of Agriculture — not the Environmental Protection Agency — to develop and monitor offset and land use provisions the legislation creates.

Waxman said he would not only retain the votes of the environmentalists, but also gain votes from those who represent the agriculture community.

“I think we will have the majority necessary to pass the bill,” Waxman said.

The Energy and Commerce Committee chairman said he would still be speaking to members of the Democratic Caucus to convince wary Democrats to vote yes.

“I’m going to continue to talk to members who’ve heard negative things about this bill from groups who are now going to support the bill,”  he said.

Hoyer on Tuesday morning said, “If we didn’t have agreement and we didn’t have the votes, then we probably  wouldn’t go forward.”

On the other side of the Capitol, Senate Majority Leader Harry Reid (D-Nev.) is taking steps to avoid friction from senators from farm states on climate change (see related story).

The climate change battle in the House is unique because Pelosi usually has to lean on liberals or centrist Democrats to get the votes she needs on hard-to-pass legislation. But the cap-and-trade measure has attracted skepticism from both factions.

Reps. Lacy Clay (D-Mo.) and Eddie Bernice Johnson (D-Texas), who are members of the Congressional Black Caucus (CBC), say they are not yet sold on the bill.

A vote-counter for the CBC, Rep. G.K. Butterfield (D-N.C.) explains that his colleagues are “reluctant to give a firm commitment until they can be satisfied that it will not disproportionately affect minority families.”

“It’s hard … in these economic times for us to say, ‘Bite the bullet’ and have higher utility bills in the winter and the summer,” Clay told The Hill.

Butterfield is calling on President Obama to become move involved.

“Now it’s time for the president to become more vocal, because he has a tremendous gift of communication and he needs to communicate with the American people,” Butterfield said.

Expected “no” votes from Democrats include Reps. Jason Altmire (Pa.), John Barrow (Ga.), Bobby Bright (Ala.), Artur Davis (Ala.), Jim Matheson (Utah), Charlie Melancon (La.), Mike Ross (Ark.)  and Gene Taylor (Miss.).

Democrats who are undecided or on the fence include Reps. Neil Abercrombie (Hawaii), Henry Cuellar (Texas), Travis Childers (Miss.), Walt Minnick (Idaho) and Tom Perriello (Va.).

Rep. Paul Hodes (D-N.H.), who is running for the Senate, backs the House bill while Rep. Carol Shea-Porter (D-N.H.), who is being targeted by Republicans, also supports it.

Republicans are anxious for the battle on the floor. The National Republican Congressional Committee sent out a fundraising letter on Tuesday stating, “Cap-and-trade is nothing more than a tax which starts accruing the moment you flip on your light switch. This ‘light switch tax’ will raise energy costs by hundreds of dollars for the average family and between 1.8 and 7 million American jobs could be lost.”

Most Republicans will reject the climate bill. Rep. Mary Bono Mack (Calif.) was the only GOP member on the Energy and Commerce Committee to back it.

Reps. Mike Castle (R-Del.) and Vernon Ehlers (R-Mich.) are undecided on the measure.

The League of Conservation Voters, an environmental group that is an active player in political campaigns, stated on Tuesday that it would not endorse any member of the House who opposed the climate bill.



Michael M. Gleeson and Jim Snyder contributed to this article.

http://thehill.com/leading-the-news/pelosis-green-gamble-2009-06-23.html
 

[Boyo]

Here is some  more on the Waxman debacle bill.

Waxman-Markey: Corruption In, Corruption Out
June 23, 2009
It’s hard to say whether the Waxman-Markey global warming bill that will soon be debated and voted on in the House is the most intellectually- and morally-corrupt bill ever seriously considered by Congress. But I’d bet that there are 433 congressmen who are glad that this legislative atrocity is not named after them.

After years of fierce battling by greens and global warming skeptics, few Americans seem to buy into the bill’s premise — that manmade emissions of carbon dioxide are causing the planet to run a fever, as Al Gore is fond of saying. Just this week, a public relations firm advising House Democrats recommended that the notion of “global warming” be dropped as a primary message since “almost no one in our focus groups expressed such concern.”

So despite all the frantic global warming alarmism — and the vicious likening of skeptics to Holocaust-deniers by Gore and the legions of green fanatics in activist groups, the media, industry and government — the out-manned and out-gunned skeptics have largely succeeded in being heard by Americans.

Ironically, the wild claims of Gore and the greens may have actually damaged the “green” brand. The PR firm also advised dropping the term “green” since it has become “meaningless or confusing” in focus group-testing.

Though stripped of its intellectual pretense, Waxman-Markey nevertheless soldiers on to House debate and vote. How this has come to pass must be one of the great tragicomedies of American political history.

To compel Congress and industry to work together toward the Waxman-Markey cap-and-trade regime, President Obama threatened both with EPA regulation of carbon dioxide, a move that would prevent Congress from reaping the political benefits of doling out $9 trillion worth of taxpayer funds to certain industries and special interest groups between 2012 and 2050. President Obama moved a step toward making good on this threat by ordering the EPA to declare carbon dioxide — what humans exhale and what plants need to grow — a threat to the public welfare.

Apparently even President Obama’s staff was somewhat embarrassed about that move. Obama climate czar Carol Browner ordered a “vow of silence” and issued an edict to “put nothing in writing ever” concerning White House staff deliberations on the matter.

When House Republicans Darrell Issa and James Sensenbrenner called for an investigation into Browner’s potentially “deliberate and willful violation” of the Presidential Records Act, Rep. Henry Waxman got Issa and Sensenbrenner to drop the subject with vague promises to “monitor the situation” and to “potentially” hold a hearing. None of Waxman supposed promises will be implemented before the House debate and vote on Waxman-Markey.

Competing for most-appalling character in the Waxman-Markey saga is Rep. Ed Markey. Immediately after the head of Warren Buffet’s electric utility unit testified against Waxman-Markey’s cap-and-trade provision, Markey fired off a letter to the Federal Energy Regulatory Commission (FERC) specifically requesting that Buffet’s utility be investigated. After being rebuked by House Republicans for this blatant intimidation, Markey then asked FERC to expand the requested investigation to all investor-owned utilities, rather than appearing to single out Buffet’s. Now all utilities are under operating with a Markey-pointed gun to their heads.

Although many businesses have been coerced into supporting Waxman-Markey, much of big business has actively pushed for the bill. Many Wall Street banks hope to profit from the trading of the $9 trillion in emissions allowances to be created under Waxman-Markey. Goldman Sachs would be the preeminent global warming bookie as it owns the exchanges where carbon allowances would be traded.

General Electric, whose CEO sits on Barack Obama’s Economic Recovery Advisory Board, was instrumental in putting together the U.S. Climate Action Partnership (USCAP), a bizarre big business-environmental activist group lobbying consortium that is a primary driver of global warming legislation. USCAP has even taken credit for drafting parts of Waxman-Markey. GE, it seems, would like a federal law requiring electric utilities buy the wind turbines and other energy technologies manufactured by — guess who — GE.

Republican James Sensenbrenner recently asked the Department of Justice to investigate USCAP members General Motors and Chrysler for illegally using taxpayer bailout money to lobby for global warming legislation. AIG, the insurance giant that is now a ward of U.S. taxpayers, only dropped out of USCAP after Rep. Joe Barton pointed out the illegality of accepting federal money and then using it to lobby the federal government.

And then there’s Al Gore, who stands to become the first “carbon billionaire” through his partnership in the venture capital firm of Kleiner Perkins Caufield and Byers and the UK-based investment firm of Generation Investment Management. When Gore testified in favor of global warming legislation before the Senate Foreign Relations Committee in January, he failed to disclose his personal financial interests and no Senator came close to asking him about them.

When he testified in April before the House Energy and Environment Subcommittee in favor of Waxman-Markey, Gore again failed to disclose his conflicts-of-interest. When Reps. Marsha Blackburn (R-TN) and Steve Scalise (R-LA) probed into these matters, Gore feigned ignorance and pretended that he would not personally benefit from Waxman-Markey. Although Rep. Waxman made baseball players testify under oath to Congress about the comparatively petty issue of drug use in baseball, he did not subject Gore to penalty for perjury.

In addition to Waxman-Markey’s $9 trillion wealth transfer from taxpayers to special interest groups, the Brookings Institution also estimates that Americans will lose $2 trillion (present value) in purchasing power between 2010-2050. Al Gore dubiously counters that the per household cost of Waxman-Markey is about the value of a postage stamp per day.

But even that’s too much for a bill that will accomplish nothing for the environment while simultaneously making a mockery of our system of government.

Steven Milloy publishes JunkScience.com and is the author of the Amazon.com bestseller, Green Hell: How Environmentalists Plan to Control your Life and What You Can Do to Stop


Enjoy Boyo

[Body-by-Guinness]

Tilting at Green Windmills
By George F. Will
Thursday, June 25, 2009

The Spanish professor is puzzled. Why, Gabriel Calzada wonders, is the U.S. president recommending that America emulate the Spanish model for creating "green jobs" in "alternative energy" even though Spain's unemployment rate is 18.1 percent -- more than double the European Union average -- partly because of spending on such jobs?

Calzada, 36, an economics professor at Universidad Rey Juan Carlos, has produced a report that, if true, is inconvenient for the Obama administration's green agenda, and for some budget assumptions that are dependent upon it.

Calzada says Spain's torrential spending -- no other nation has so aggressively supported production of electricity from renewable sources -- on wind farms and other forms of alternative energy has indeed created jobs. But Calzada's report concludes that they often are temporary and have received $752,000 to $800,000 each in subsidies -- wind industry jobs cost even more, $1.4 million each. And each new job entails the loss of 2.2 other jobs that are either lost or not created in other industries because of the political allocation -- sub-optimum in terms of economic efficiency -- of capital. (European media regularly report "eco-corruption" leaving a "footprint of sleaze" -- gaming the subsidy systems, profiteering from land sales for wind farms, etc.) Calzada says the creation of jobs in alternative energy has subtracted about 110,000 jobs elsewhere in Spain's economy.

The president's press secretary, Robert Gibbs, was asked about the report's contention that the political diversion of capital into green jobs has cost Spain jobs. The White House transcript contained this exchange:

Gibbs: "It seems weird that we're importing wind turbine parts from Spain in order to build -- to meet renewable energy demand here if that were even remotely the case."

Questioner: "Is that a suggestion that his study is simply flat wrong?"

Gibbs: "I haven't read the study, but I think, yes."

Questioner: "Well, then. [Laughter.]"

Actually, what is weird is this idea: A sobering report about Spain's experience must be false because otherwise the behavior of some American importers, seeking to cash in on the U.S. government's promotion of wind power, might be participating in an economically unproductive project.

It is true that Calzada has come to conclusions that he, as a libertarian, finds ideologically congenial. And his study was supported by a like-minded U.S. think tank (the Institute for Energy Research, for which this columnist has given a paid speech). Still, it is notable that, rather than try to refute his report, many Spanish critics have impugned his patriotism because he faulted something for which Spain has been praised by Obama and others.

Judge for yourself: Calzada's report can be read at http://tinyurl.com/d7z9ye. And at http://tinyurl.com/ccoa5s you can find similar conclusions in "Yellow Light on Green Jobs," a report by Republican Sen. Kit Bond, ranking member of the Environment and Public Works Committee's subcommittee on green jobs and the new economy.

What matters most, however, is not that reports such as Calzada's and the Republicans' are right in every particular. It is, however, hardly counterintuitive that politically driven investments are economically counterproductive. Indeed, environmentalists with the courage of their convictions should argue that the point of such investments is to subordinate market rationality to the higher agenda of planetary salvation.

Still, one can be agnostic about both reports while being dismayed by the frequency with which such findings are ignored simply because they question policies that are so invested with righteousness that methodical economic reasoning about their costs and benefits seems unimportant. When the president speaks of "new green energy economies" creating "countless well-paying jobs," perhaps they really are countless, meaning incapable of being counted.

For fervent believers in governments' abilities to control the climate and in the urgent need for them to do so, believing is seeing: They see, through their ideological lenses, governments' green spending as always paying for itself. This is a free-lunch faith comparable to that of those few conservatives who believe that tax cuts always completely pay for themselves by stimulating compensating revenue from economic growth.

Windmills are iconic in the land of Don Quixote, whose tilting at them became emblematic of comic futility. Spain's new windmills are neither amusing nor emblematic of policies America should emulate. The cheerful and evidently unshakable confidence in such magical solutions to postulated problems is yet another manifestation -- Republicans are not immune: No Child Left Behind decrees that by 2014 all American students will be proficient in math and reading -- of what the late senator Pat Moynihan called "the leakage of reality from American life."

georgewill@washpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2009/06/24/AR2009062403012.html

[Body-by-Guinness]

The Climate Change Climate Change
The number of skeptics is swelling everywhere.

Steve Fielding recently asked the Obama administration to reassure him on the science of man-made global warming. When the administration proved unhelpful, Mr. Fielding decided to vote against climate-change legislation.

If you haven't heard of this politician, it's because he's a member of the Australian Senate. As the U.S. House of Representatives prepares to pass a climate-change bill, the Australian Parliament is preparing to kill its own country's carbon-emissions scheme. Why? A growing number of Australian politicians, scientists and citizens once again doubt the science of human-caused global warming.

Among the many reasons President Barack Obama and the Democratic majority are so intent on quickly jamming a cap-and-trade system through Congress is because the global warming tide is again shifting. It turns out Al Gore and the United Nations (with an assist from the media), did a little too vociferous a job smearing anyone who disagreed with them as "deniers." The backlash has brought the scientific debate roaring back to life in Australia, Europe, Japan and even, if less reported, the U.S.

In April, the Polish Academy of Sciences published a document challenging man-made global warming. In the Czech Republic, where President Vaclav Klaus remains a leading skeptic, today only 11% of the population believes humans play a role. In France, President Nicolas Sarkozy wants to tap Claude Allegre to lead the country's new ministry of industry and innovation. Twenty years ago Mr. Allegre was among the first to trill about man-made global warming, but the geochemist has since recanted. New Zealand last year elected a new government, which immediately suspended the country's weeks-old cap-and-trade program.

The number of skeptics, far from shrinking, is swelling. Oklahoma Sen. Jim Inhofe now counts more than 700 scientists who disagree with the U.N. -- 13 times the number who authored the U.N.'s 2007 climate summary for policymakers. Joanne Simpson, the world's first woman to receive a Ph.D. in meteorology, expressed relief upon her retirement last year that she was finally free to speak "frankly" of her nonbelief. Dr. Kiminori Itoh, a Japanese environmental physical chemist who contributed to a U.N. climate report, dubs man-made warming "the worst scientific scandal in history." Norway's Ivar Giaever, Nobel Prize winner for physics, decries it as the "new religion." A group of 54 noted physicists, led by Princeton's Will Happer, is demanding the American Physical Society revise its position that the science is settled. (Both Nature and Science magazines have refused to run the physicists' open letter.)

The collapse of the "consensus" has been driven by reality. The inconvenient truth is that the earth's temperatures have flat-lined since 2001, despite growing concentrations of C02. Peer-reviewed research has debunked doomsday scenarios about the polar ice caps, hurricanes, malaria, extinctions, rising oceans. A global financial crisis has politicians taking a harder look at the science that would require them to hamstring their economies to rein in carbon.

Credit for Australia's own era of renewed enlightenment goes to Dr. Ian Plimer, a well-known Australian geologist. Earlier this year he published "Heaven and Earth," a damning critique of the "evidence" underpinning man-made global warming. The book is already in its fifth printing. So compelling is it that Paul Sheehan, a noted Australian columnist -- and ardent global warming believer -- in April humbly pronounced it "an evidence-based attack on conformity and orthodoxy, including my own, and a reminder to respect informed dissent and beware of ideology subverting evidence." Australian polls have shown a sharp uptick in public skepticism; the press is back to questioning scientific dogma; blogs are having a field day.

The rise in skepticism also came as Prime Minister Kevin Rudd, elected like Mr. Obama on promises to combat global warming, was attempting his own emissions-reduction scheme. His administration was forced to delay the implementation of the program until at least 2011, just to get the legislation through Australia's House. The Senate was not so easily swayed.

Mr. Fielding, a crucial vote on the bill, was so alarmed by the renewed science debate that he made a fact-finding trip to the U.S., attending the Heartland Institute's annual conference for climate skeptics. He also visited with Joseph Aldy, Mr. Obama's special assistant on energy and the environment, where he challenged the Obama team to address his doubts. They apparently didn't.

This week Mr. Fielding issued a statement: He would not be voting for the bill. He would not risk job losses on "unconvincing green science." The bill is set to founder as the Australian parliament breaks for the winter.

Republicans in the U.S. have, in recent years, turned ever more to the cost arguments against climate legislation. That's made sense in light of the economic crisis. If Speaker Nancy Pelosi fails to push through her bill, it will be because rural and Blue Dog Democrats fret about the economic ramifications. Yet if the rest of the world is any indication, now might be the time for U.S. politicians to re-engage on the science. One thing for sure: They won't be alone.

Write to kim@wsj.com

http://online.wsj.com/article/SB124597505076157449.html

Printed in The Wall Street Journal, page A13

[Body-by-Guinness]

The Dirty War Against Clean Coal

By GREGG EASTERBROOK
Published: June 28, 2009
Washington

WHILE President Obama’s cap-and-trade proposal to reduce greenhouse gases has been the big topic of recent environmental debate, the White House has also been pushing a futuristic federal project to build a power plant that burns coal without any greenhouse gases. Sounds great, right? Except the idea is a rehash of a proposal that went bust the first time around.

More important, the technology already exists to make huge reductions in greenhouse emissions from coal, allowing power companies to begin cutting the carbon footprint of coal today. Instead, advanced-technology coal power sits on the shelf while regulators wait to see what happens with a project that may be just an expensive boondoggle.

The big project, a public-private partnership called FutureGen, was first announced by George W. Bush in 2003. Dreading facing up to the problem of greenhouse gases from electricity generation, the Bush White House suggested that decisions should wait while FutureGen developed a coal-fired power with no emissions. FutureGen’s administrators spent five years on studies, proposals and studies of studies, but never broke ground for a test installation.

Then, in a fit of integrity, the Department of Energy decided the project should be put in Illinois, a Democratic state — Midwestern coal is high in carbon, making this a logical choice — rather than in Republican Texas, which the White House preferred. The administration promptly canceled financing for FutureGen. But this month, Energy Secretary Steven Chu announced he was reviving the project, hinting that the ultimate cost may run to billions of dollars.

FutureGen was better off canceled. Government is good at basic research, poor at commercial-scale applied energy technology. The Synthetic Fuels Corporation, a heavily subsidized attempt begun by the Carter administration to manufacture gasoline substitutes, flopped without ever producing a marketable gallon. The Energy Department has also financed such overpriced, unrealistic projects as the MOD-5B, a wind turbine that weighed 470 tons and stood 20 stories tall: it looked like a gigantic propeller intended to push the earth to a new star system. It ended up being sold for scrap.

The Obama administration’s FutureGen plan calls for yet another year of study before any actual action; test runs may not begin for a decade. No wonder the project’s nickname is “NeverGen.” This is part of a Washington tradition — beginning pie-in-the-sky projects that create an excuse to avoid forms of conservation and greenhouse-gas reduction that are possible immediately. Companies including General Electric have already perfected technology to reduce emissions substantially, called “integrated gasification combined cycle” power. (Yes, it needs a better name.)

Current coal-fired power plants burn pulverized coal using a combustion process that hasn’t changed in a half a century. The new approach turns coal into a gas similar to natural gas, which runs through a device similar to a jet engine. Such plants can achieve near-zero emissions of toxic material and chemicals that form smog, and they require about a third less coal than regular coal-fired power plants to produce an equal amount of energy, which means about a third lower greenhouse gases.

Beyond that, the promising technology of “sequestering” carbon dioxide — pumping it back into the ground to keep it out of atmosphere — appears for technical reasons to be impractical for conventional pulverized-coal power plants. But gasification plants have technical characteristics that should make “sequestration” of carbon feasible. A gasification power plant with sequestration would have around two-thirds lower greenhouse gases than a conventional coal-fired generating station.

The first commercial gasification power plant, designed by General Electric for Duke Energy, is being built in Indiana. Yet, absurdly, most state public-utility commissions have denied requests to construct these environmentally friendly systems. Last year, Virginia denied a major utility’s request to build a coal-fired power plant that would have sequestered nearly all its carbon output.

One reason Virginia gave for the denial was the higher up-front cost of a gasification plant. Yet, once greenhouse gases are regulated (and President Obama’s cap-and-trade plan would in effect tax carbon), the economics of gasification plants may become attractive, with low-emission plants costing less to run.

Another reason for the denials is that utility commissions are waiting for the outcome of the FutureGen experiment. This is a classic instance of the best being enemy of the good. Rather than starting to cut coal-caused carbon emissions right now, we are waiting to see if a hypothetical system could achieve perfection decades from now. Meanwhile, emissions continue willy-nilly.

FutureGen is politically appealing: contractors get subsidies, politicians get to hand out money in their districts and astonishing breakthroughs are promised at unspecified future dates. Why aren’t progressives fighting for an immediate embrace of gasification power? Much of the environmental movement clings to a fairyland notion that coal combustion can soon be eliminated, and therefore no coal-fired power plant of any kind, even an advanced plant, should be built.

Reflecting this mindset, Senate Majority Leader Harry Reid has said he opposes integrated gasification plants — only new solar, wind and geothermal facilities should be allowed. Environmentalists who correctly point out there can never be absolutely “clean coal” thus end up in the position of opposing coal that’s far cleaner than what we are using.

Yet coal use is a future certainty. Half of our power comes from coal, versus about 2 percent from solar and wind: in the next few decades, green power simply cannot grow quickly enough to eliminate the need for coal. We have two choices: do nothing and wait for FutureGen while coal-caused carbon emissions continue unabated; or start building improved coal-fired plants that reduce the problem. Which seems more forward-thinking?

Gregg Easterbrook is the author of “The Progress Paradox” and the forthcoming “Sonic Boom.”

http://www.nytimes.com/2009/06/29/opinion/29easterbrook.html?_r=1&ref=opinion

[HUSS]

The Sound Of Suppressed Science Canada's top authority on polar bears is barred from

--------------------------------------------------------------------------------

from smalldeadanimals.com .....


The Sound Of Suppressed Science

Canada's top authority on polar bears is barred from ....
......an international meeting on polar bears, of course!
Dr Mitchell Taylor has been researching the status and management of polar bears in Canada and around the Arctic Circle for 30 years, as both an academic and a government employee. More than once since 2006 he has made headlines by insisting that polar bear numbers, far from decreasing, are much higher than they were 30 years ago. Of the 19 different bear populations, almost all are increasing or at optimum levels, only two have for local reasons modestly declined.
Dr Taylor agrees that the Arctic has been warming over the last 30 years. But he ascribes this not to rising levels of CO2 – as is dictated by the computer models of the UN's Intergovernmental Panel on Climate Change and believed by his PBSG colleagues – but to currents bringing warm water into the Arctic from the Pacific and the effect of winds blowing in from the Bering Sea.
He has also observed, however, how the melting of Arctic ice, supposedly threatening the survival of the bears, has rocketed to the top of the warmists' agenda as their most iconic single cause. The famous photograph of two bears standing forlornly on a melting iceberg was produced thousands of times by Al Gore, the WWF and others as an emblem of how the bears faced extinction – until last year the photographer, Amanda Byrd, revealed that the bears, just off the Alaska coast, were in no danger. Her picture had nothing to do with global warming and was only taken because the wind-sculpted ice they were standing on made such a striking image.
Dr Taylor had obtained funding to attend this week's meeting of the PBSG, but this was voted down by its members because of his views on global warming. The chairman, Dr Andy Derocher, a former university pupil of Dr Taylor's, frankly explained in an email (which I was not sent by Dr Taylor) that his rejection had nothing to do with his undoubted expertise on polar bears: "it was the position you've taken on global warming that brought opposition".
Dr Taylor was told that his views running "counter to human-induced climate change are extremely unhelpful".

By the way, the average temperature in the arctic this year is still below zero, "the latest date that this has happened in 50 years of record-keeping".

[Body-by-Guinness]

Taking the hot air out of wind power

By Chris Bell
The idea of wind generated electric energy is being sold by environmentalists as an overlooked opportunity to reduce greenhouse gasses. Global warming advocates claim that this discounted treasure could be a major part of an effort to reduce the burning of fossil fuels and eliminate the need for some of our nuclear power plants.

Is it true that we are passing up on a gold mine of renewable energy in favor of unnecessary and harmful fossil and nuclear fuels?

Let's start by looking at what we use to generate the power we use today. Renewables, such as wind, solar, biomass, etc, provide 2.4% of our electricity.  The bulk of our power, 51%, comes from coal, followed by natural gas at 20% and nuclear at 19%.

Included below in the category "other renewables", wind energy is currently supplying about 1% of our electricity



Can we replace coal and natural gas with renewable energy sources? Let's examine the facts.

Wind energy is harnessed by windmills that are similar to the types that have been around for centuries. The windmills that produce electricity are called wind turbines; they employ fan blades that turn when the wind is blowing. These blades are connected to electric generators.

Keep in mind that sometimes the wind blows slowly or not at all, and windmills don't produce any power until the wind reaches about 8 MPH. A location for a windmill is not considered viable unless wind speeds average 14 MPH.

The percentage of its rated power that a windmill can actually produce, given the variation of wind speeds at the installation site, is called its capacity factor. A realistic capacity factor is 25%. That means that over time, the windmill actually delivers 25% of its rated power.

(Electrical energy is measured in units called watts.  A kilowatt (KW) is 1,000 watts, a megawatt (MW) is a million watts. )

A typical large wind-driven turbine is rated at about 1,500 kilowatts. It's 350 feet tall and has a fan blade of about 240 feet in diameter.  It will actually deliver about 375 kilowatts. It can power about 375 microwave ovens, or 6250 60-watt light bulbs simultaneously (only when the wind is blowing at about 25 miles per hour, which is a very strong wind). An average (1 gigawatt) power plant can power nearly a million microwaves, or 16 million light bulbs at the same time.

A power plant near me produces 1,100,000 kilowatts (1.1 gigawatts) of power. At a 25% capacity factor it would take nearly 2600 large wind turbines to produce the same power as this nuclear power plant. And this is not a particularly large plant.

If you placed these 2600 wind turbines the recommended 5 rotor-blade diameters apart, they would stretch for 600 miles. That's as far as the distance from Michigan to Georgia. In practice wind turbines are not placed single file, they are placed in several rows, like crops, in what are called wind farms, but you get the idea.

The amount of electricity generated by a wind turbine is proportional to the wind speed to the 3rd power (a 20 MPH wind will produce 8 times as much energy as a 10 MPH wind). Therefore wind turbines often produce energy in bursts; when the wind gusts, the energy output spikes, when the wind dies down, energy output dips.


Unfortunately, there is no easy way to store these bursts of energy for later use. There are no batteries large enough that are also practical, and pumped-storage systems, which use unwanted energy to pump water into an aboveground reservoir for later use in turning a water-driven generator, require a large body of water.

And when there is no wind, windmills produce no power, so a traditional power plant must be operational at all times to provide power during those in-between times.

Also, most areas of the country have so little wind that wind turbines are not practical. As indicated in the wind resource map below, most of best energy-producing wind power areas are located far from population centers. The white areas are those that don't have fast enough winds to make wind power viable.



Wind power does work. It is a clean and renewable source of energy. But it does have its limitations; we would have to have wind turbines stretching from sea to sea to equal the energy output we can get from traditional power plants, and they would only be a match for conventional power plants when the winds were strong.  On calm days they would produce no energy.

And since most of the power would be generated in unpopulated areas, because that's where the strong winds are, (see map above) we would have to incur huge losses to transport this energy to where it is needed.

And after all that, we would still need to maintain our current system of traditional power plants because we would have to have a backup source for when the wind is calm.

And since the traditional power plants can't be turned on and off like a light bulb, it will be necessary to use the traditional power plants to provide the bulk of our power and use the wind generated power to supplement the power plants.

All things considered, wind power has limitations that will relegate it to a role as a supplementary, not a primary, source of our electrical energy.

So the next time you hear a pundit say that we should throw over fossil and nuclear fuel in exchange for wind, know that it is not possible. And any proposals that are predicated on the replacement of natural fossil fuels, such as the replacement of real jobs with "green jobs" is as fallacious as an equation that is predicated on 2 plus 2 equaling 5.

Page Printed from: http://www.americanthinker.com/2009/07/taking_the_hot_air_out_of_wind.html at July 02, 2009 - 01:44:24 PM EDT

[DougMacG]

Guinness, great post regarding wind. I am not against wind energy it's just important to keep in perspective that as we increase our investment in it, hopefully private and voluntary, that it will continue to make up closer to 1-2% of thepower on the future grid.  That means 98% of our focus should be elsewhere. 

It is a tragedy that natural gas is 'wasted' on electrical generation since it is so extremely valuable for other uses.  Also a tragedy is our refusal to recognize the merits of nuclear, carbon-free, powerful and safe.  We had more deaths from a one-line 19mph light rail line here in one year than in the nationwide history of nuclear power. 

If we eventually invent the holy grail car battery and move most of the transportation sector energy to the electrical grid, where then does the additional carbon-neutral energy come from, not to mention grid capacity?

I can think of only two answers, sequestered coal and clean secure nuclear energy.

Back to wind, aside from the lengthy caveats about wind, that half the country isn't windy enough, that none is produced when the wind goes down and none is produced during shut down when the wind is too strong and that they litter, obstruct and dominate the natural landscape, there is a cost factor as well.  Best estimates I have read put the cost of wind at 5-times clean coal and solar at 15-times clean coal.  Given that disparity I think it wonderful if people choose of their free will to cover their roof with energy security and invest in their own wind tower on their own land, but not a solid payoff for public expenditure.

[DougMacG]

Raising energy costs will boost job growth? Newt has a nice way of pointing out what to me seems obvious.  Why don't they tell us that destroying the economy as we know it is worth it to save the planet instead of telling us with a straight face that the largest tax increase in history is a jobs, jobs, jobs bill?

http://www.washingtonexaminer.com/opinion/columns/Cap-and-Trade-is-another-way-of-saying-2_2_5-7882637-49117697.html
Newt Gingrich: Cap-and-Trade is another way of saying 2+2=5

By: Newt Gingrich
Examiner Columnist | 6/26/09 6:44 AM

The Obama White House has spent the week furiously working to convince its fellow Democrats in Congress to support the global warming bill that's before the House today. Former Vice President Al Gore has been working the phones, and there was even a luau at the White House last night.

The question that must be asked, however, is why? If the case is closed on man's role in causing climate change, as the left assure us that it is, then why the need to twist Democratic arms to do something about it?

My guess is it has something to do with 2+2=4.

This simple arithmetic - 2+2=4 - was a rallying cry during the Polish Solidarity freedom movement in the 1980s. It meant that, even though the government would try to tell the people that 2+2=5, to be free, the people had to tell the truth, that 2+2=4. Because to deny the truth was to deny reality, and to do that was to surrender freedom to the government.

Something similar is happening with the global warming bill.

The sponsors of the global warming bill, which is known as Waxman-Markey, are telling Americans that not only will the legislation save us from calamitous climate change, it will also produce new jobs and new prosperity by transitioning America to new forms of "green" energy.

In other words, under Waxman-Markey, there's no trade-off necessary to save the planet; no price to be paid. It's a win-win-win.

Right. And 2+2=5.

The reality is that the bill before the House today imposes what could be the largest tax increas

[Crafty_Dog]

Some of the fastest growing sources of renewable energy in the world are the wind, the sun -- and the lowly wood pellet.

European utilities are snapping up the small combustible pellets to burn alongside coal in existing power plants. As a global marketplace emerges to feed their growing appetite for pellets, the Southeastern U.S. is becoming a major exporter, with pellet factories sprouting in Florida, Alabama and Arkansas.

 
(Discuss: What energy source is most important for meeting future U.S. needs? Wood pellets -- cylinders of dried shredded wood that resemble large vitamins -- are the least expensive way to meet European renewable-energy mandates, utility executives and industry consultants say.)

Made from fast-growing trees or sawdust, pellets are a pricier fuel than coal, but burning them is a less-expensive way to generate electricity than using windmills or solar panels. Burning pellets releases the carbon that the trees would emit anyway when they die and decompose, so the process is widely regarded as largely carbon neutral. In contrast, carbon is locked away in coal and is only released once the coal is dug out of the earth and burned.

The wood-pellet market is booming because the European Union has rules requiring member countries to generate 20% of their electricity from renewable sources by 2020. Europe imported €66.2 million (about $92.6 million) of pellets and other wood-based fuels in the first three months of 2009, up 62% from the same period a year earlier, according to the EU's statistical arm.

 Government mandates are essential to the increasing use of pellets in power generation, and the growing global pellet trade, experts say.

"You are looking at a totally artificial market," said Christian Rakos, chief executive of Propellets, an Austria-based trade group of pellet producers. "No power plant would consider using pellets for one minute if they didn't have to do it."

Still, Europe's eagerness for more pellets has turned the U.S. into an energy exporter. Until recently, there were only about 40 pellet factories in the U.S., which produced about 900,000 tons a year, mostly for heating homes.

But in May 2008, Green Circle Bio Energy Inc. opened a pellet plant in Cottondale, Fla., that produces 500,000 tons of pellets a year; it ships them by rail to the coast and then on to Rotterdam, Netherlands. The company, owned by Swedish concern JCE Group AB, wants to build another big plant in the U.S., said Olaf Roed, chief executive of Green Circle.

Another 500,000-ton facility in Selma, Ala., owned by Dixie Pellet LLC, also opened last year. And Phoenix Renewable Energy LLC plans to break ground next month on a 250,000-ton-a-year pellet plant in Camden, Ark., along with a 20-megawatt power plant run off tree scraps that will feed heat to the pellet plant. The $100 million facility's output for five years has been contracted to go to Europe, and Phoenix is working on another five facilities.

Pellets can either be made out of sawdust left over from lumber production or from soft-wood trees such as pine. These aren't growing in wild forests, but in industrial plantations where they can be harvested easily and often.

Photo Journal

 
Jason Henry for The Wall Street Journal
 
Green Circle employees race to repair one of the pellet mill's dies that give the pellets their compacted cylindrical shape at the plant in Cottondale, Fla., July 1.
At Green Circle's Florida facility, bark is stripped off the tree and burned to generate steam used in making the pellets. The tree itself is cut up in a wood chipper, dried and hammered into a powder, which is formed into pellets under very high pressure.

It is easy for these pellet plants to find raw material. The pulp and paper industry is declining, and the housing slump has sapped the need for hardwood. Forest owners are ecstatic that pellet plants are stepping in.

"We are irrationally exuberant," said Lee Laechelt, executive vice president of the Alabama Forest Owners Association.

Australia, New Zealand, Argentina and Vietnam are also shipping pellets to Europe, as are Canada and South Africa, said Helmer Schukken, CEO of GF Energy BV, a Rotterdam-based trader.

Wood pellets are becoming the newest global commodity, with prices posted on an Amsterdam energy exchange, Mr. Schukken said. "It is becoming like trading coal."

That will make it easier for England's Drax Group PLC, which is installing equipment at its giant 4,000-megawatt coal-fired power plant in North Yorkshire to use pellets in place of coal for up to 10% of the fuel. Pellet makers say Drax is lining up contracts in the U.S. Other big buyers include Dutch power company Essent NV, which is being acquired by Germany's RWE AG, and French GDF Suez SA's Electrabel unit.

Of course, U.S. utilities may soon be as interested as their European counterparts in burning pellets instead of coal. California, which has a goal of producing 33% of its electricity from renewable sources by 2020, is looking at using wood products in coal plants.

If a federal renewable energy standard is approved, "we won't be shipping pellets overseas," said Phoenix Renewable Energy's development director, Steve Walker. "We'll be shipping them domestically."

[Crafty_Dog]

second post
=============
Democrats Admit That Their Cap and Trade Bill Is a Job Killer
 
By Peter Roff

In her remarks bringing the debate over the climate bill to a close, House Speaker Nancy Pelosi of California urged her colleagues to vote in favor of the cap and trade bill, saying the measure was about four things: "jobs, jobs, jobs, and jobs."

She was right—the House-passed version of cap and trade is all about jobs: jobs lost, jobs never created, jobs sent overseas, and, unbelievably, jobs people will be paid for doing long after they cease to exist.

According to Friday's Washington Times, the legislation includes language that provides, should it become law, that people who lose their jobs because of it "could get a weekly paycheck for up to three years, subsidies to find new work and other generous benefits—courtesy of Uncle Sam."

How generous are these benefits? Well, according to the Times, "Adversely affected employees in oil, coal and other fossil-fuel sector jobs would qualify for a weekly check worth 70 percent of their current salary for up to three years. In addition, they would get $1,500 for job-search assistance and $1,500 for moving expenses from the bill's 'climate change worker adjustment assistance' program, which is expected to cost $4.2 billion from 2011 to 2019."

Instead of being a the source of millions of new jobs of "green jobs"—as House Democrats are fond of saying over and over again—the provision is a hidden admission that their effort is a job killer, not just a massive new tax on energy.

Building a safety net into the legislation is probably the responsible thing to do. The government is going to be directly responsible for the destruction of millions of jobs if the bill passed by the House becomes law—anywhere from a net loss of .5 percent of total jobs over the first 10 years, according to the liberal Brookings Institution, to 3 million by the year 2030, according to the industry-backed Coalition for Affordable American Energy. But wouldn't it be better to leave the jobs alone in the first place? It would certainly be cheaper.

[DougMacG]

Bloomberg reports that a respected analyst sees oil prices collapsing further with the economy.  Just like artificially high prices helped trigger the downturn, collapsing prices will shut down newer and more expensive energy sources, making the next oil spike even worse if/when we ever see economic health return.

Verleger Sees $20 Oil This Year on ‘Devastating’ Glut (Update1)
http://www.bloomberg.com/apps/news?pid=20601087&sid=aQBXqFcd5gJo

By Grant Smith

July 16 (Bloomberg) -- Crude oil will collapse to $20 a barrel this year as the recession takes a deeper toll on fuel demand, according to academic and former U.S. government adviser Philip Verleger.

A crude surplus of 100 million barrels will accumulate by the end of the year, straining global storage capacity and sending prices to a seven-year low, said Verleger, who correctly predicted in 2007 that prices were set to exceed $100. Supply is outpacing demand by about 1 million barrels a day, he said.

“The economic situation is not getting better,” Verleger, 64, a professor at the University of Calgary and head of consultant PKVerleger LLC, said in a telephone interview yesterday. “Global refinery runs are going to be much lower in the fall. If the recession continues and it’s a warm winter, it’s going to be devastating.”

Crude oil last traded at $20 a barrel in February 2002. Futures were at $61.18 today in New York, having recovered 89 percent from a four-year low reached last December. The Organization of Petroleum Exporting Countries is implementing record supply cuts announced last year in response to plunging consumption.

“OPEC don’t realize the magnitude of the cuts they need to make,” which would total about a further 2 million barrels a day, Verleger added. “Storage is going to become tight. It’s not clear if there’s going to be enough storage available.”

China, Inflation

Oil will average $63.91 in the fourth quarter, according to the median of analyst forecasts compiled by Bloomberg. Crude for December delivery traded at $65.61 today in New York. Prices have rebounded on expectations of a demand recovery, led by China and other developing economies, and concern expansionary monetary policy would stoke inflation and weaken the dollar.

At the other end of the spectrum from Verleger, Goldman Sachs Group Inc. predicted in a report yesterday oil will rally to $85 a barrel by the end of the year, and recommended that clients buy futures contracts for delivery in December 2011.

“China is in a real desperate situation,” said Verleger, who publishes the Petroleum Economics Monthly. “We’re in a situation where U.S. consumers aren’t consuming and Chinese manufacturers get hurt. Economists are looking for growth in all the wrong places.”

Forward contracts for oil have been higher than prices for immediate delivery this year, a situation known as contango, creating incentives to buy crude now and store it. That may end as growing stockpiles make storage more expensive.

“Prices would be much lower today, but for the very large incentive to build inventories,” Verleger said. “You need forward buyers, which we had when people were fearing inflation, but as concerns turn toward deflation” that will no longer be the case.

[Body-by-Guinness]

August 04, 2009
Green Jobs: Fast-tracking Economic Suicide

By Michael Economides and Peter Glover
Creating ex nihilo -- literally, out of nothing -- used to be a theological concept, God's prerogative. Today it seems, President Barack Obama and certain Western politicians claim to possess the ability to do it. Against all the laws of economics and the marketplace, they believe they can create millions of ‘green' real jobs, out of thin air, or at least air without carbon dioxide, via cap and trade. 

If Obama & Co. were to remove their green-tinted glasses for just a moment and take a long hard look at the European experience they profess to cite as ‘proven', they would discover those glasses have been rose-tinted all along.

The basic assumption is that technology per se generates jobs. Mostly, it does not. Rather, technology enables jobs -- real and sustainable jobs -- based on how useful the technology is to the marketplace.  To generate real industrial jobs, however, one needs a basic commodity to trade, and in the energy business this has meant oil, gas or coal.  Yet ‘green' politicians and eco-lobbyists expect to create a revolution in green jobs based on ... alternative energy sources.  The trouble is that alternative energy sources remain and will continue to be appallingly inefficient, offering a very poor to mostly negative return on investment. Cut off the flow of massive public subsidies and the alternative energy industrial revolution would grind to a halt tomorrow -- as the European experience already bears out.

What the EU experience shows is that for every green job created per installed MW power, a real job is destroyed elsewhere in the economy. Not to mention, it aids the reduction of competitiveness, investment in expansion and, ultimately, promotes the relocation of major companies to countries without draconian carbon regimes that cause energy price hikes.

 It's a shame that members of the US Congress that voted for the recent Cap and Trade Climate Bill did not bother to check up on the economic realities which are causing European states to back away from expensive alternative energy commitments and the ‘green job' creation schemes associated with them by inserting all manner of substance-emptying ‘get-out' clauses into EU cap and trade plans.

Germany's Angela Merkel has already insisted on major exemptions for German heavy industry come December's ‘definitive' global climate summit in Copenhagen. Bizarrely, for a so-called ‘Green Chancellor', Merkel's government is also supporting the building of 26 new coal-fired power plants across Germany.   Hardly the domestic agenda of a low-carbon ‘green jobs' economy.   Italy also rocked the EU climate boat by insisting on exemptions for its own energy-intensive industries at the turn of the year. Most significantly, it is an exemption that requires the EU to renegotiate Europe's entire climate policy after the UN summit in December -- effectively, giving Italy a veto. A veto it will use if, as expected, China and India and others exempt themselves from binding targets.  In June, deputy head of Poland's Solidarity trade union, Jaroslaw Grzesik, estimated that the EU's climate policy would cost 800,000 European jobs. The think-tank Open Europe has already estimated that the same policies will cost the UK $9 billion a year, leaving an extra 1 million people in fuel poverty by 2020.

These are the real world economic realities for "countries like Spain, Germany and Japan" that Barack Obama insisted in January 2009 are "surging ahead of us" in the low carbon-green jobs revolution. Cited as a role model, Spain is the only country to have produced an in-depth analysis of the impact of renewables on the jobs market. The Study of the effects on employment of public aid to renewable energy sources was published by a team at the Universidad Rey Juan Carlos in March, 2009. Though it grabbed a few headlines in the spring, it was largely ignored by the mainstream press. Yet it is the most intensive review of the impact of a state-aided green job creation policy available.  Here are just a few of its key statements suggesting why the state should stay the heck out of manipulating the job creation market:

"Despite its hyper-aggressive (expensive and extensive) ‘green jobs' policies ... Spain has created a surprisingly low number of jobs."

"Since 2000 Spain has spent €571,138 ($800K) to create each ‘green job', including subsidies of more than €1million ($1.4million) per wind industry job."

"The programs creating those jobs also resulted in the destruction of nearly 110,500 jobs elsewhere in the economy or 2.2. jobs destroyed for every ‘green job' created."

"Each ‘green' megawatt installed destroys 5.28 jobs on average elsewhere in the economy: 8.99 by photovoltaics (solar), 4.27 by wind energy, 5.05 by mini-hydro."

The report also notes that according to Spain's energy regulator, "The price of a comprehensive electricity rate (paid by the end consumer) in Spain would have to be increased 31 percent to repay the historic debt generated by the subsidies to renewables."

The report cites key examples of resulting "massive unemployment, loss of capital, dismantlement of productive facilities and perpetuation of inefficient ones" the direct result of, "the arbitrary, state-established price systems inherent in ‘green energy' schemes." The report concludes, "Policymakers must recognize that because of government action, other jobs are not created." And, most significantly for international consumption, "These costs do not appear to be unique to Spain's approach but instead are largely inherent in schemes to promote renewable energy sources."

President Obama maintains his planned 5 million new jobs will cost the taxpayer $30,000 per job. Bad enough, we might think. But The Center for American Progress, whose CEO headed-up Obama's transition team, calculates it would take government spending of $100 billion to create 2 million green jobs. That's a cost to the taxpayer of $50,000 to create a single "green job". The Apollo Alliance, whose founder served on Obama's campaign, calculates it would take $500 billion to create 5 million jobs. That's a mere $100,000 per green job created. 

Worrying about others "surging ahead" no longer matters once you realize it's along the fast-track to economic suicide.  Green jobs? It's not good for the economy, stupid.

Michael Economides is Editor-in-chief at Energy Tribune & Peter Glover is European Associate Editor, Energy Tribune.

Page Printed from: http://www.americanthinker.com/2009/08/green_jobs_fasttracking_econom.html at August 04, 2009 - 11:20:21 AM EDT

[Body-by-Guinness]

August 6, 2009
The Economic Consequences of Waxman-Markey: An Analysis of the American Clean Energy and Security Act of 2009
by David Kreutzer, Ph.D., Karen Campbell, Ph.D., William W. Beach, Ben Lieberman and Nicolas Loris
Center for Data Analysis Report #09-04
After a truncated debate and last-minute changes, the House of Representatives narrowly passed climate-change legislation on June 26, 2009, designed by Henry Waxman (D-CA) and Edward Markey (D-MA). The 1,427-page bill would restrict greenhouse gas emissions from industry, mainly carbon dioxide from the combustion of coal, oil, and natural gas.

Since energy is the lifeblood of the American economy, 85 percent of which comes from CO2-emitting fossil fuels, the Waxman-Markey bill represents an extraordinary level of economic interference by the federal government. For this reason, it is important for policymakers to have a sense of the economic impact that accompanies any environmental benefits.[1]

Analysis by The Heritage Foundation's Center for Data Analysis (CDA) makes clear that Waxman-Markey promises serious perils for the American economy for the years and decades ahead. Waxman-Markey requires arbitrary and severe restrictions on the current energy supply and infrastructure. These restrictions can be met only through large-scale deployment of still-undeveloped or uneconomical technologies and alternative energy sources. In addition to the direct impact on consumers' budgets through higher electric bills and gasoline prices, the resultant increase in energy costs will reverberate throughout the economy and inject unnecessary inefficiencies at virtually every stage of production. It would suppress economic activity and reduce employment, especially in the manufacturing sector. Virtually all costs would eventually filter down to the American people.





Waxman-Markey extracts trillions of dollars from the energy-using public and delivers this wealth to various groups--some of whom may be more deserving than others, and some who are simply better at lobbying. That could mean low-income households in an attempt to compensate them for sharply higher energy costs, or regulated industries that have effectively lobbied for compliance assistance. In any event, cap-and-trade allowances are a tax and would be the largest tax increase in recent history.

The recent experience with ethanol-use mandates illustrates the costs and unanticipated (at least by proponents) problems with a federal intervention in energy markets. However, Waxman-Markey represents a vastly more complex and comprehensive scheme, which suggests that the scope and intensity of unintended effects could be greater than either proponents or critics of Waxman-Markey currently anticipate. In addition, Europe's experience with climate-change laws similar to Waxman-Markey strongly suggests both high costs and uncertain emissions reductions.

Overview

Waxman-Markey imposes strict limits on the emissions of six greenhouse gases (GHGs) with the primary emphasis on carbon dioxide (CO2). The mechanism for capping these emissions requires regulated emitters to acquire federally created permits (allowances) for each ton emitted. The allowances have the economic effect of a tax--energy users will, of course, have to pay for the energy itself, and will also have to pay for the rights to use it if its production involved one of the regulated greenhouse gases. The increase in energy costs stemming from paying for these permits to emit creates correspondingly large transfers of income from private energy consumers to special interests: the federal government collects the revenues from the sale of the allowances and redistributes them to individuals and groups (businesses included) that are listed in the legislation.

Implementing the Waxman-Markey legislation will be very costly, even given the rather optimistic assumptions about how effective it will be in reducing CO2 emissions and how accommodating the economy will be to the added energy costs. The Heritage Foundation's dynamic analysis of these economic costs are summarized as follows (adjusted for inflation to 2009 dollars):

Cumulative gross domestic product (GDP) losses are $9.4 trillion between 2012 and 2035;
Single-year GDP losses reach $400 billion by 2025 and will ultimately exceed $700 billion;
Net job losses approach 1.9 million in 2012 and could approach 2.5 million by 2035. Manufacturing loses 1.4 million jobs in 2035;
The annual cost of emissions permits to energy users will be at least $100 billion by 2012 and could exceed $390 billion by 2035;
A typical family of four will pay, on average, an additional $829 each year for energy-based utility costs; and
Gasoline prices will rise by 58 percent ($1.38 more per gallon) and average household electric rates will increase by 90 percent.
This CDA analysis extends only to 2035, as this is the forecasting horizon for the macroeconomic model used to prepare these estimates. But it should be noted that the emissions reductions continue to tighten through 2050 and that model-based analysis by other groups whose models extend beyond 2035 shows increasing harm to the U.S. economy.

In addition to burdening households, the high energy prices weaken the production side of the economy. Contrary to the claims of an economic boost from "green" investment as firms undertake the changes to reduce emissions and increased employment as so-called green jobs are created to do this work, Waxman-Markey would be a significant net drain on GDP and employment.

Description of the Legislation

Waxman-Markey is a cap-and-trade bill. It caps greenhouse gas emissions from regulated entities beginning in 2012. At first, each power plant, factory, refinery, and other regulated entity will either be allocated allowances (rights to emit) for six greenhouse gases, or be made to purchase these allowances, or some combination of the two. In the early years, most of the allowances will be given away. Perhaps one result of the ill-conceived last-minute changes is that for some years there are promises to distribute more than 100 percent of the available allowances to various interest groups. However, Heritage analysts assume, as do the bill writers, that most emitters will need to purchase at least some allowances. Note that whether allowances are sold or given away had no effect on the energy cost increases, which are caused by the constraint on supply.

Emitters who reduce their emissions below their annual allotment can sell their excess allowances to those who do not--the trade part of cap and trade. Over time, the cap is ratcheted from a 3 percent reduction of 2005 levels (the base year for measuring and mandating future GHG reductions) by 2012 to an 83 percent reduction by 2050.

Effects on Industry

Waxman-Markey affects some industries more than others. Some industries are undoubtedly more energy-intensive and thus hit harder by higher energy prices. Particularly alarming is the damage that Waxman-Markey inflicts on America's manufacturing base. By 2035, the last year of the simulation, durable manufacturing employment will have lost 1.17 million jobs. Nondurable manufacturing losses reach almost 210,000 jobs by 2035. Combined, manufacturing employment averages 389,000 less than the baseline between 2012 and 2035, hitting a high of 1.38 million lost jobs in 2035. [1]

Other industries experience the effects of higher energy prices as well. The fabricated-metal industry will see jobs drop by an average of more than 51,000 below the baseline and 216,000 below by 2035. The machinery industry will shed 263,000 jobs by 2035. Plastic and rubber products employment falls 33,000 jobs below the baseline on average as a result of Waxman-Markey and is 80,000 below business-as-usual in 2035, the last year of the simulation. The employment-services industry faces substantial losses, reaching 428,000 in 2035 and averaging 93,000 fewer jobs than the baseline from 2012 to 2035.

Two other industries adversely affected by this cap-and-trade legislation are transportation and trade. With cap-and-trade regulation, retail-trade unemployment increases by 276,000 in 2035, with a yearly average loss of 78,000, while wholesale trade unemployment increases by 400,000 in 2035, and 191,000 on average each year. The trade, transportation, and utilities sector losses reach 1.1 million jobs by 2035 and 441,000 for the yearly average. Transportation and warehousing employment drops 383,000 by 2035 and has an average yearly loss of 175,000 jobs.

Because agriculture is energy intensive, it would be disproportionately burdened by Waxman-Markey. Higher gasoline and diesel fuel prices, higher electricity costs, and higher natural-gas-derived fertilizer costs all erode farm profits, which are expected to decline by 28 percent in 2012 and average 57 percent lower through 2035.
Also noteworthy are the effects on gas stations, which tend to be small businesses. Employment in the gas station industry is an average 33,000 jobs below the baseline every year from 2012 through 2035.

The model also includes an industry-production index. An industry-production index is a composite measure of the output produced by each of the companies within an industry. Roughly, the index is created by a weighted average of the total output by each company within an industry divided by the base year's weighted average total.[2] The index is based on a common year and, therefore, provides a comparable measure of increases or decreases in an industry's output over time.
Of all the industries modeled, only a handful showed increases in output under Waxman-Markey.[3] Most decreased, and the set of industries whose output fell the most include:

durable goods,
railroad equipment,
miscellaneous manufacturers,
motor vehicles and parts,
light truck and utility vehicles,
electrical equipment, appliances, and components,
communications equipment, computers, and electronics,
engines and turbines,
metalworking machinery,
construction,
agricultural equipment,
glass and glass products,
rubber and plastic products,
medical equipment and supplies, and
mining and its support activities.

[1]The term "baseline" refers to the projections of the U.S. economy's future between 2009 and 2035 without the Waxman-Markey legislation becoming law. This baseline does contain all of the enacted energy legislation by this and previous Congresses. For example, the baseline used in this CDA Report contains the current law about fuel efficiency standards and the development of alternative energy sources.
[2]For a more precise description of production indices as well as the methodology used to compile them, see "Studies in Methods--Index Numbers of Industrial Production," Series F, No. 1, United Nations Statistics Division, Department of Economic and Social Affairs, 2008, at http://unstats.un.org/unsd/cr/temp/IIP_Draft_version_080502.pdf (July 24, 2009).

[3]Those industrial groupings that increase are: leather and allied products; bags and coated and treated paper; semiconductors; newspapers and misc. publishers; periodicals; books; and cutlery and hand tools. The first most likely reflects a consumer switch from synthetically produced materials that require relatively more emissions. There is a broad applicability of semiconductors along with a need to find new technological processes. Newspapers and other media may historically be somewhat inversely related to unemployment as less work time may increase the demand for reading material both for leisure and education. Cutlery and hand tools may be driven by more labor-intensive processes, rather than motorized processes.

Allowance Giveaways

President Obama's budget proposal suggested a 100 percent auction of the emission allowances, forcing companies to bid on the right to emit. In order to get the Waxman-Markey cap-and-trade bill through the House Energy and Commerce Committee, however, Members of Congress promised generous handouts for various industries and special interests. In the near term, the legislation promises to distribute 85-101 percent of the allowances to various interest groups at no cost. The percentages for each industry decrease over time.

Electric Utilities. The biggest winners are the electric utilities, receiving 43.75 percent of the emission allowances in 2012 and 2013. The free allowances fall to 38.89 percent in 2014 and 2015, and 35 percent from 2016 through 2025. Beginning in 2026, the freely distributed allowances fall by 7 percent per year, until they reach zero by 2030. Small local-distribution electric companies are given 0.5 percent of the allowance value from the enactment of the bill through 2025; it is then reduced by 0.1 percent until it reaches zero. Energy-efficient cogeneration facilities receive 0.35 percent in the first year, but nothing after that.

Energy Sectors. The natural gas industry receives 9 percent of the allowances beginning in 2016, until they are reduced by 1.8 percent per year beginning in 2026. The handouts reach zero in 2030. For home heating oil and propane consumers, only 1.88 percent of the allowances are given in years 2012 and 2013. This decreases to 1.67 percent for the next two years, and to 1.5 percent from 2016 through 2025. After this they are phased out by 0.3 percent each year. Oil refiners receive 2 percent of the allowances from 2014 through 2026. On top of this, small business refineries will receive 0.25 percent from 2014 to 2026.

[Body-by-Guinness]

Protecting the Poor. The bill stipulates that the revenues from 15 percent of the allowances sold at auction will go to low-income consumers.

Trade-Affected Industries. Energy-intensive and "trade-exposed" industries will undoubtedly be at a competitive disadvantage in relation to companies in other countries that do not put a price on carbon emissions. To mitigate this result, the bill gives 2 percent of the allowances to affected industries for the first two years of the bill's enactment, which increases to 15 percent beginning in 2014, and then slowly phases them out to zero by 2035.





Transitioning to Cleaner Energy. To invest in clean technology and renewable energy, 10.05 percent of the free allowances are set aside beginning immediately in 2012. The majority of these allowances will go to State Energy and Environmental Development (SEED), which allows state energy offices to allocate the revenue to specified energy efficiency and renewable energy programs. A small portion, 0.5 percent, goes toward more energy-efficient building codes. The free allowances fall to 7.05 percent for 2016 and 2017, 6.03 percent for 2018 to 2021, 1.53 percent for 2022 to 2025, rises back to 8.58 percent from 2026 to 2029, and remains at 5.03 percent thereafter. The auto industry receives 3 percent of the allowances from 2012 to 2017, and 1 percent from 2018 to 2025.

Universities, institutions, and any "Clean Energy Innovation Center," which will study energy-efficient building systems and designs, are awarded 1.05 percent of the allowances beginning in 2012 and lasting until 2050. Eight energy-innovation hubs at universities, private research entities, industry sites, or state institutions that focus on clean-energy technology will receive 0.45 percent of allowances from 2012 through 2050. Worker-assistance programs receive 0.5 percent of the allowances from 2012 through 2021, and 1 percent for 2022 through 2050. For the year 2012 only, 1 percent is designated to early actors, which rewards those who have already taken approaches to reduce carbon dioxide emissions, such as no-till farming and planting trees. The allowance revenue would only be available for entities that publicly stated and reported greenhouse gas reduction goals and demonstrated net reductions. The allowances cover only "reduction activity" that took place between January 1, 2001, and January 1, 2009. To foster the deployment of carbon capture and sequestration (CCS), a relatively untried process that reduces the amount of carbon dioxide emissions from industrial facilities, the bill allocates 1.75 percent of the emission allowances from 2014 through 2017, 4.75 percent from 2018 to 2019, and 5 percent from 2020 through 2050 for installing and operating CCS technologies.

Supplemental Reduction. From 2012 to 2025, 5 percent of the allowance revenue will be allocated for supplemental reduction, such as for funding international forestry products. This falls to 3 percent in 2026, to 2 percent in 2031, and continuing through 2050. Supplemental agriculture and renewable energy receive 0.28 percent of the handouts beginning in 2012 and ending in 2016.



Adaptation Efforts. Domestic adaptation efforts to protect humans, landscapes, and wildlife affected by climate change receive 0.9 percent of the allowances from 2012 through 2021, growing to 1.9 percent in 2022 and to 3.9 percent in 2027. Specifically, 0.1 percent of the allowance handouts will go to the Climate Change Health Protection and Promotion Fund from 2012 to 2050 to protect the health of humans affected by climate change; 0.385 percent and 0.615 percent go to wildlife and natural-resource adaptation distributed to states and the Natural Resources Climate Change Adaptation Fund, respectively. These percentages increase to 0.770 and 1.23, respectively, for the years 2022 to 2026, and increase again to 1.54 percent and 2.46 from 2027 to 2050.

International adaptation to increase resilience as well as reduce vulnerability to climate change and international deployment of clean-energy technologies receive 1 percent each from 2012 to 2021, increasing to 2 percent each year beginning in 2022, and increasing again to 4 percent from 2027 through 2050.

Macroeconomic Simulation Overview

In a market-based economy, most effects of a policy are transmitted through price signals that are driven by changes in consumption and production decisions at the micro level. The aggregate impact these changes have on the economy is based on how these price signals interact with other markets and shift the economy's resources. Moving below the baseline means that the economy is operating less efficiently and that, therefore, the resources in the economy were better utilized under the baseline scenario than under the new policy.

Heritage analysts used the IHS Global Insight long-term macroeconomic model of the U.S. economy to estimate the effects of the Waxman-Markey bill on the overall economy.[2] The simulation was implemented by changing variables in the macroeconomic model according to the changes predicted by a microeconomic model of the energy sector maintained by the CDA (see the section describing the CDA energy model below). In order to estimate the policy impact, three main pieces needed to be simulated: (1) price effects, (2) energy-efficiency (demand) effects, and (3) allowance revenue and allocation effects.

The policy changes in Waxman-Markey affect pro ducer prices in the energy sectors directly through the cost of purchasing allowances and offsets as well as through changes in production needed to reduce emissions.[3] The energy model estimated the change in energy production prices and retail energy prices. These prices were matched with their corresponding variables in the macroeconomic model to estimate the effect these price changes would have on the overall economy.

The energy model projects changes in fuel efficiency and changes in total highway fuel consumption. The corresponding macroeconomic model variables were changed. The effect of these changes helps mitigate some of the total increased consumer expenditure on fuel.

The macroeconomic model does not have specific variables corresponding to the alternative renewable fuel sources in the CDA energy model. The macroeconomic simulation takes into account the increase in domestic alternative-fuel sources by adjusting the amount of imported fuel.

The last piece of the simulation is the allowance revenue component. As discussed above, the value of permits equals the entire value of these permits as government revenue, regardless of whether they are formally auctioned. As much as possible, the revenue allocations followed the details in Henry Waxman and Edward Markey's May 14, 2009, memo "Proposed Allowance Allocation."[4] Any unallocated allowance revenue remained in the federal government's general consumption variable and was thus allocated by the model in ways consistent with the historical pattern of government spending.[5]

The Waxman-Markey Energy Model

To meet the emissions reduction goals of Waxman-Markey, the price of fossil-fuel energy must increase enough to drop the quantity demanded to the target levels. The allowance price is the tax on fossil-fuel energy that causes the price to increase. The allowance tax will be determined as refiners, electric companies, natural gas distributors, and certain other energy users bid against each other for the allowances. As the allowance price increases, these bidders will find it increasingly difficult to pass the costs on to the ultimate consumers, thus they bid for fewer allowances. This, in turn, restricts the amount of fossil fuel that will be consumed and determines the added price consumers must pay for energy.

The amount of CO2 emitted per unit of energy generated depends on the type of fuel used. The energy model used by the Center for Data Analysis is based on the IHS Global Insight energy module and adds the appropriate cost to each energy source for various allowance prices.[6]

Further, the model incorporates estimates of user responses to price changes (demand elasticity) for natural gas, petroleum products, coal, and electricity. Following a well-known pattern, this responsiveness to price changes grows over time.

In the CDA model, the allowance prices for all years are adjusted until the aggregate amounts of CO2 emissions from all fuels reaches the target emissions for that year. To account for offsets, the targets are increased by 15 percent above the caps for every year. In the early years, the business-as-usual emissions are greater than the allowances alone, but less than the allowances plus offsets. For those years, the allowance price is set at the estimated world clearing price for offsets--$20 per ton. Beyond the year 2018, the offsets limits are reached and the allowance price rises as the caps become tighter. The allowance price exceeds $120 per ton of CO2 by 2035.

The Economic Costs of Waxman-Markey

The Waxman-Markey bill affects the economy directly through higher prices for carbon-based energy, which reduces quantity demanded and, thus, the quantity supplied of energy from carbon fuels. Energy prices rise because energy producers must pay a fee for each ton of carbon they emit. The fee struc ture is intended to create an incentive for producers to invest in technologies that reduce carbon emissions during energy production. The bill's sponsors and supporters hope that the fees are sufficiently high to create a strong incentive and demand for cleaner energy production and for the widespread adoption of carbon capture and sequestration technology.

The economic model that CDA analysts used to estimate the bill's broad economic effects treats the fees as a tax on energy producers. Thus, energy prices increase by the amount of the fee or tax. The demand for energy, which largely determines the consumption and, thus, the taxes collected, responds to higher energy prices both directly and indirectly. The direct effect is a reduction in the consumption of carbon-based energy.

The indirect effects are more complex. Generally speaking, the carbon fees reduce the amount of energy used in producing goods and services, which slows the demand for labor and capital and reduces the rate of return on productive capital. This "supply-side" impact exerts the predictable secondary effects on labor and capital income, which depresses consumption.[7]

These are not unexpected effects. Carbon-reduc tion schemes that depend on fees or taxes attain their goals of lower atmospheric carbon by slowing carbon-based economic activity. Producers and consumers respond to the carbon taxes both by switching to less carbon-intensive production and consumption and by simply reducing production and consumption.

The Heritage study assumes that renewable electricity generation (not including conventional hydro) and biofuels grow by a factor of four between 2010 and 2035. The baseline used in the Heritage analysis already includes significant increases in wind energy, solar power, ethanol, biodiesel, and biomass-derived energy. So, the economic impacts are in addition to the costs of these large baseline increases in alternative energy supply.

With the combined impact of these responses, policymakers can expect results similar to the following economic effects:[8]



Economic Output Declines. The broadest measure of economic activity is the change in GDP after accounting for inflation. GDP measures the dollar value of all goods and services produced in the United States during the year for final sale to consumers. The changes that Waxman-Markey causes in GDP are a broad measure of the altered pattern of all other economic variables.

The initial shock of higher energy prices reduces GDP by nearly $200 billion in each of the first few years. As always, markets strive to counter shocks. Because of the generosity of the offsets, the carbon constraints do not further tighten until 2018 and markets move GDP closer to the higher baseline levels. However, after 2018 the carbon limits put ever increasing pressure on energy markets and GDP losses grow each year. Though the annual losses decrease somewhat after 2032, the Waxman-Markey impact continues to destroy more than $600 billion of GDP value every year until the end year of the Heritage analysis (2035).

Driving energy prices higher is a fundamental feature of cap and trade. It is the higher price of fossil-fuel energy (85 percent of U.S. energy) that forces firms and households to use less of it. There is no allowance-distribution scheme that can lower overall energy costs. Though some allowances given to regulated electric utilities may, at least initially, lower prices for their customers, this would undermine the necessary conservation and force greater costs on other consumers. There will be no net energy price reductions. Further, allowances given to unregulated firms will simply go to the bottom line and not to consumers.

In aggregate, the GDP losses for 2012 to 2035 are $9.4 trillion even after adjusting for inflation.

This slowdown in GDP is seen more dramatically in the slump in manufacturing output. Indeed, by 2020, manufacturing output in this energy-sensitive sector is 2 percent below what it would be if Waxman-Markey never becomes law. By 2035, the manufacturing sector has lost $585 billion in output when compared to the CDA baseline; that is, when compared to the economic world without Waxman-Markey.

Number of Jobs Declines. Though lost GDP is the broadest measure of the economic impact, it often seems a remote measure. Looking beneath the surface of GDP shows the economic reactions to the legislation that led up to the drop in output. The change in employment is one such reaction.

Instead of creating jobs, Waxman-Markey is a job destroyer. Compared to the baseline (a no-Waxman-Markey world), the average year has 1.1 million fewer people working. By 2035, this Waxman-Markey jobs deficit has risen to nearly 2.5 million lost jobs.

The job losses are widely, but not evenly, distributed. For instance, the construction industry loses 8.5 times as many of its jobs than the economy as a whole. The job-loss rate for the textile industry is more than 7.8 times the rate of overall job loss; 4.4 times the overall rate for manufacturing; 5.9 for durable manufacturing; 5.3 for paper products; and 7.1 for wood products.

Because the distribution of energy-intensive jobs across the country is unequal, some states and congressional districts will be hit particularly hard. Notable among the most adversely affected states throughout the duration of the bill are: Wisconsin, Indiana, Minnesota, Iowa, New Hampshire, North Carolina, South Carolina, Idaho, and Alabama. Some states, such as Wyoming, North Dakota, Colorado, and Nebraska are most adversely affected when the policy first takes effect, while other states, such as Michigan, Ohio, and Tennessee, are among the hardest-hit states by 2035.[9]

Energy Prices Rise. The policy-induced higher energy prices, which signal the constraint of energy, are the root cause of the slower economy. As Chart 5 shows, consumer prices for electricity, natural gas, and home heating oil increase significantly between 2015 and 2035. Indeed, by 2035, the total energy bill for a family of four is $1,200 higher than it would be otherwise. Between 2012 and 2035, the total increase in expenditure on energy is nearly $20,000. This increase occurs not only after adjusting for inflation, but also after households have adjusted as well as possible to the higher energy prices.

[Body-by-Guinness]

By 2035, Waxman-Markey causes electricity prices to rise 90 percent over and above the rise that would have occurred anyway. By turning thermostats down in winter and up in summer; by purchasing more energy-efficient, but more expensive, appliances; by adding more insulation to houses; by living in smaller houses; and by manifold other changes, U.S. energy consumption is cut by more than 30 percent. Nevertheless, even these cuts are not sufficient to fully offset the price increase for electricity. The net effect is that a family of four will spend $468 more on electricity alone because of Waxman-Markey.

Incomes and Consumption Decline. Higher energy prices also drive up production costs, which must be reflected in product prices. Since higher prices reduce quantities sold, producers produce less. In turn, workers and investors earn less, and household incomes decline. The especially sharp income and employment reductions in the energy-intensive sectors spread and cause declines in demand for other sectors of the economy.

The CDA simulation captures this effect of higher energy prices. Consumption outlays by individuals and house holds follow the pattern of lower income. In 2012, consumption expenditures are $129 billion lower than they would be in an economic world in which Waxman-Markey is not the law. By 2030, the drop in consumption expenditures reaches $357 billion--$3,823 less per family of four.

Taxes Increase. The allowances created by Waxman-Markey to restrain CO2 emissions do not create economic value, which is another way of saying that the allowances do not improve the material well-being of Americans. Instead, they are a form of taxation and will be one of the largest taxes collected by the federal government.[10] This tax created by Waxman-Markey will collect $5.7 trillion over the period 2012 to 2035--at a cost of thousands of dollars per year per family.



National Debt Grows. Because the Waxman-Markey cap-and-trade tax reduces income, it reduces the revenues collected from other taxes, such as personal and corporate income taxes. And because the revenue collected from Waxman-Markey is spent, the net effect is to increase the national debt. By 2035, Waxman-Markey will have added 9.1 trillion nominal dollars to the national debt, which amounts to an increased tax liability of $12,803 for every American, or a $51,216 liability for a family of four in today's (2009) dollars.

Climate Impact Does Not Register. Because of market-driven increases in energy efficiency, CO2 emissions have grown more slowly than has national income for decades in the United States.[11] Contrasted with the moderating growth of American CO2 emissions, those of the developing world, especially China and India, have been accelerating. China is now the world's largest emitter of CO2. Because the developing world is so populous and because large segments are finally experiencing the rapid economic growth that perverse economic policies had previously stifled, the growth in CO2 emissions will swamp the cuts proposed in the U.S. by Waxman-Markey.

Climatologists estimate that Waxman-Markey's impact on world temperature will be too small to even measure in the first several decades. The theoretical moderation of world temperature would be 0.05 degree centigrade by 2050. If CO2-emission levels meet the Waxman-Markey target of 17 percent of 2005 emissions by the year 2050, and if they are frozen at that level for the rest of the century, Waxman-Markey would still reduce the world temperature by only 0.2 degree Celsius by 2100.

 
 
Cost to Americans: Hundreds--or Thousands?

Analyses of the economic impact of Waxman-Markey fall into two basic categories: (1) studies that show annual economic costs to be a few hundred dollars per family per year; and (2) others showing family costs measured in thousands of dollars per year.

These two notable "postage stamp" studies come from the EPA and the Congressional Budget Office.[1] The EPA asserts that Waxman-Markey will reduce household consumption by $98 to $140 per year throughout the duration of the policy. What is never mentioned by those trumpeting this number is what it really means.
First, the EPA employs a technique from the financial world called "discounting" to reduce the value. For example, the EPA estimates that the inflation-adjusted cost per household in 2050 will be $1,287. However, after this value is discounted to the present, the cost is $140 per household.[2] Note that discounting is not done to adjust for inflation--that has already been done. Present-value discounting is a technique for comparing the value of money paid at different points in time. If a household must pay $1,287 in 2050, the $140 represents the amount that household would have to pay into an interest-bearing account today so that the interest would allow it to grow to $1,287 by 2050. Discounting can be a legitimate tool for cost-benefit and investment analysis where costs and benefits are paid and benefits received at different times. Thus, both are discounted to the same point in time and compared. Without discounted environmental impacts for comparison, using the technique, here, does little except undercount the cost that families will actually be paying in 2050.

Second, the EPA measures consumption, not income. The broadest and best measure of cost is lost income--lost GDP. Consumption only comes after taxes and savings are deducted. Ignoring lost savings and lost payments for government services underestimates the costs by about 40 percent.

Third, the EPA measures cost per household. Households are not necessarily families. One person living alone counts as a household, as do three single people sharing an apartment. The EPA uses the average household size of 2.6 people. Converting from this EPA household size to a family of four adds more than 50 percent to the cost estimate.

So, the EPA's $174 cost per household is actually above $2,700 (even after adjusting for inflation) when presented as lost income per family of four. This is not a postage stamp per day.

The CBO study, on the other hand, does not even attempt a comprehensive measure of lost income and it explicitly states so in footnote 3 of its report.[3] In addition, the CBO study assumes that government expenditure of one dollar is the same as not taxing that dollar. Finally, the CBO created an artificial year (2020 in terms of a 2010 economy), which allows it to project a lower tax cost in the first place because the baseline in 2010 is lower than the baseline in 2020. The CBO's methodology effectively measures the administration costs of collecting and distributing the allowances rather than the full economic cost.

Analysts from across the ideological spectrum who estimate comprehensive measures of lost income due to Waxman-Markey find costs that are also measured in thousands of dollars per year. The Heritage estimate for lost GDP in 2020 is $161 billion, which translates to nearly $1,900 per family of four. The CRA International study (conducted for the National Black Chamber of Commerce) and a Brookings Institution study both project costs that translate to about $5,000 per family of four.[4]

[1]Environmental Protection Agency, "EPA Analysis of the American Clean Energy and Security Act of 2009 H.R. 2454 in the 111th Congress," June 23, 2009, at http://www.epa.gov/climatechange/economics/pdfs/HR2454
_Analysis.pdf (July 25, 2009), and Congressional Budget Office, "The Estimated Costs to Households from the Cap-and-Trade Provisions of H.R. 2454," June 19, 2009, at http://www.cbo.gov/ftpdocs/103xx/doc10327
/06-19-CapAndTradeCosts.pdf (July 25, 2009).

[2]EPA, p. 13.

[3]CBO, p. 4.

[4]David Montgomery et al., "Impact on the Economy of the American Clean Energy and Security Act of 2009 (H.R.2454)," CRA International, May 2009, at http://www.nationalbcc.org/images/stories/documents/
CRA_Waxman-Markey_%205-20-09_v8.pdf (July 25, 2009), and Warwick McKibbin, Pete Wilcoxen, and Adele Morris, "Consequences of Cap and Trade," Brookings Institution, June 8, 2009, at http://www.brookings.edu
/~/media/Files/events/2009/0608_climate_change_economy/20090608
_climate_change_economy.pdf (July 25, 2009).

Conclusion

The Waxman-Markey bill proposes a new national tax of historic proportions. Though levied directly on carbon-based energy, the tax's impact spreads through the economy, increasing prices, reducing income, destroying jobs, and significantly expanding the national debt.

As with many policies coming from Washington these days, the Waxman-Markey bill seeks to "level the playing field" by making a more competitive player weaker, in this case hamstringing carbon-based energy sources, rather than ensuring an environment where less competitive players can become stronger. This policy hurts everyone, including alternative-energy investors, because it uses resources less efficiently, which creates deadweight losses. This means there will be underused resources leading to fewer opportunities in the future as slower growth reduces the resources available to help power the research and development investments that will create the technologies of the future.

As President Obama said about his cap-and-trade program during the presidential election campaign, "electricity prices would necessarily skyrocket."[12] The same applies to many other prices as the Waxman-Markey energy tax spreads through the economy. Businesses and consumers will adapt as well as possible to these higher prices. They will spend more for less energy. They will build smaller houses and buildings. They will drive smaller, less safe vehicles. They will turn thermostats up in the summer and down in the winter. They will divert income to more expensive energy-saving appliances. But these activities and more will not be enough to offset the higher energy costs. The net effect is lower income, higher prices, and fewer jobs.

In particular, the Heritage analysis projects that by 2035:

Gasoline prices will rise 58 percent (or $1.38) above the baseline forecast, which already contains price increases;
Natural gas prices will rise 55 percent;
Heating oil prices will rise 56 percent;
Electricity prices will rise 90 percent;
A family of four can expect to pay $1,241 more for energy costs per year;
Including taxes, a family of four will pay $4,609 more per year;
A family of four will reduce its consumption of goods and services by up to $3,000 per year, as its income and savings fall;
Aggregate GDP losses will be $9.4 trillion;
Job losses will be nearly 2.5 million; and
The national debt will rise an additional $12,803 per person.
(All figures are in constant 2009 dollars.)

All of these costs will be paid for no more than a 0.2 degree (Celsius) moderation in world temperature increases by 2100, and no more than a 0.05 degree reduction by 2050. Saddling the next generation with higher prices, higher debt, less income, fewer jobs, and more taxes does not seem like a worthy legacy--especially when the purported environmental benefits are so small they can barely be measured.

David W. Kreutzer, Ph.D., is Senior Policy Analyst for Energy Economics and Climate Change in the Center for Data Analysis; Karen A. Campbell, Ph.D., is Policy Analyst in Macroeconomics in the Center for Data Analysis; William W. Beach is Director of the Center for Data Analysis; Ben Lieberman is Senior Policy Analyst in Energy and the Environment in the Thomas A. Roe Institute for Economic Policy Studies; and Nicolas D. Loris is a Research Assistant in the Thomas A. Roe Institute for Economic Policy Studies, at The Heritage Foundation.


 

Appendix 1: Methodological Appendix

 

IHS/Global Insight Long-Term U.S. Macroeconomic Model

The IHS/Global Insight long-term U.S. macroeconomic model is a large-scale 30-year (120-quarter) macroeconometric model of the U.S. economy. It is used primarily for commercial forecasting.

Over the years, analysts at The Heritage Foundation's Center for Data Analysis (CDA) have worked with economists at Global Insight (GI) to adapt the GI model to policy analysis. CDA analysts use the GI model to evaluate the effects of policy changes not only on disposable income and consumption in the short run, but also on the economy's long-run supply-side potential. They can do so because the GI model imposes the long-run structure of a neoclassical growth model but makes short-run fluctuations in aggregate demand a focus of analysis.

The Global Insight model can be used to forecast more than 1,400 macroeconomic aggregates. Those aggregates describe final demand, aggregate supply, incomes, industry production, interest rates, and financial flows in the U.S. economy. The GI model includes such a wealth of information about the effects of important changes in the economic and policy environment because it encompasses detailed modeling of consumer spending, residen tial and non-residential investment, government spending, personal and corporate incomes, federal (and state and local) tax revenues, trade flows, financial markets, inflation, and potential gross domestic product.

Consistent with the rational-expectations hypothesis, economic decision-making in the GI model is generally forward-looking. In some cases, Global Insight assumes that expectations are largely a function of past experience and recent changes in the economy. Such a retroactive approach is taken in the model because GI believes that expectations change little in advance of actual changes in the economic and policy variables about which economic decision makers form expectations.

Operation of the U.S. Macroeconomic Model

The policy changes contained in Waxman-Markey and simulated in the U.S. energy model (as described in the paper) resulted in changes in the U.S. macroeconomic model of energy-price variables, energy use and demand variables, and government revenue and spending variables. The changes predicted by the energy model were introduced into the macro model in order to simulate the overall economic impact of the Waxman-Markey bill. In order to mitigate differences in scale and baseline assumptions between the energy model variables and the corresponding macroeconomic variables, the percentage changes in variables predicted by the energy model, rather than the new value, were imposed on their macroeconomic variable counterparts. These changes were implemented in the following ways:

[Body-by-Guinness]

Energy Price Effects. The macro model contains a host of prices that are changed through their interaction with other variables in this model. The policy changes in Waxman-Markey affect the prices that consumers pay for energy and the prices that producers in the energy sectors pay for their inputs directly. The direct microeconomic impact of the legislation is thus simulated by the microeconomic model of the energy sector. (The energy model is described in the main text.) The direct micro effect is then used to change the macro model in order to simulate the net economic effect on the macro economy induced by the far-reaching ripple effects of the microeconomic changes to the energy sector.

Price changes simulated by the energy model for the producer prices were used to adjust the corresponding variables in the macro model. The prices that energy-sector producers pay were then made exogenous; thus these prices were driven by the energy-model simulation. The following producer-price categories were affected: coal, natural gas, electricity, natural gas, petroleum products, and residual fuel oil.

CDA analysts employed a similar procedure in implementing changes in consumer prices. In this case, the variables affected were all consumption-price deflators. Once again, we substituted changes predicted by the energy-model simulation for these variables for their macro-model counterparts. The following consumption price deflators were affected: fuel oil and coal, gasoline, electricity, and natural gas.

Unlike in the Lieberman-Warner climate-change bill, the energy model simulation of Waxman-Markey did not predict changes for major macroeconomic cost drivers: West Texas Intermediate Crude Spot Price, Refiners' Average Cost of Crude Oil (domestic and imported), Henry Hub Spot Price, and Natural Gas Wellhead Price. These prices are largely affected by the imported price of crude oil. Instead, the Waxman-Markey legislation influences market prices further down the domestic production line where emissions constraints are binding.

Energy Consumption Effects. In theory, higher energy prices could be driven by increased energy demand. Thus, CDA analysts adjusted the macroeconomic model to account for decreases in the demand for carbon-based fuels. The changes that were made for the variables  total energy consumption, total end-use consumption for petroleum, total end-use consumption for natural gas, total end-use consumption for coal, and total end-use consumption for electricity were again obtained from the energy model simulation.

Both the energy model and the macro model contain equations that predict changes in demand for energy, given changes in energy prices, but the energy model contains a more detailed treatment of demand. Preferring details over generality, CDA analysts lined up the demand equations in both models and substituted settings from the energy model for those in the macro model. Specifically, analysts lined up these demand equations:

Total energy consumption,
Total end-use consumption for petroleum,
Total end-use consumption for natural gas,
Total end-use consumption for coal, and
Total end-use consumption for electricity.
In addition to the consumption price effects, overall spending is influenced by changes in fuel efficiency. The energy model predicts changes in fuel efficiency and changes in total highway fuel consumption. The macro model variables for average miles per gallon of new light vehicles and the average miles per gallon of the light vehicle stock were changed according to the change predicted by the energy model. The highway consumption of fuel was adjusted by an average of the change simulated in the energy model of highway consumption of fuel by cars and light trucks.

Renewable Energy Production. The energy model predicted changes in renewable sources. These energy supplies would affect market prices for energy, albeit the macro model does not have an explicit price deflator for renewable energy. The effect of domestic renewable sources of energy would also influence the amount of oil imported. The macro model adjusts differences between supply and demand in energy by affecting imports through a residual variable that is exogenous in the model. This means that the model would not account for substitutions in supply andwould incorrectly increase imports by the decrease in traditional sources of domestic energy. Thus this residual value was changed in the macro model according to the changes estimated by the energy model for the new level of imports, domestic production (both renewable and nonrenewable), and domestic consumption. This allowed the macroeconomic simulation to implicitly take account of the increase in alternative fuel source supply.

Revenue Estimates. The energy model produces estimates of carbon emissions and of the carbon fee in dollars per metric ton. By multiplying the emissions by the carbon fee, analysts obtained the "revenue" from the emissions permits.

Heritage analysts assumed that the revenue value of permits equals the entire value of these permits as government revenue, regardless of whether they are formally auctioned. If the government chooses to transfer ownership of the permits to other entities, that would be reflected as a transfer payment in the national income accounts. The allocation of the value of this revenue is a source of much debate among the legislators. Heritage analysts allocated the revenue as much as possible, given the sparse detail in the memo "Proposed Allowance Allocation" by Chairman Henry A. Waxman and Chairman Edward J. Markey dated May 14, 2009. Any unallocated allowance revenue remained in the federal government's general consumption variable and was thus allocated by the model in ways consistent with the historical pattern of government spending.

Specifically, the allowance value was transferred to individuals in the form of non-Medicare or Social Security full-employment transfers (as opposed to an aid transfer driven by an economic downturn like an unemployment benefit transfer). The various transfers specified in the memo amounted to 15.5 percent of the value transferred until 2021, and 16 percent of the value transferred to individuals thereafter.

Revenues allocated to state and local governments were more complicated. These were: 11.5 percent in 2012 to 2015; 9 percent in 2016 to 2017; 8 percent in 2018 to 2021; 6.5 percent in 2022 to 2025; 6 percent in 2026; 5.75 percent in 2027; 5.5 percent in 2028; 5.25 percent in 2029; and 5 percent in 2030 to 2035.

The state and local transfers were then allocated as transfers of aid to individuals in the amount of 1.5 percent of state funds through 2030. The remaining allowance value that was given to states and not transferred to individuals was put in the state and local general consumption variable and allocated by the macro model according to the historical pattern used for these funds. (At the state and local levels these historical uses are largely additional transfers to individuals.)

The macro model would have deficit-financed this increased spending rather than recognize the value as being generated by the allowances purchased (explicitly or implicitly) in the private sector. The variable for federal government tax receipts on production and imports other than from a value-added tax was increased by the value of the allowances to account for the increased revenue generation. This allowed the macro model to more accurately forecast the likely debt burden, interest rate effects, and so on, as well as the tax burden on the private sector by this transfer to government.

Monetary Policy. The monetary policy variable in the macro model was turned on, dictating that monetary policy would be adjusted according to a Taylor-type rule over the forecast horizon. The Taylor rule adjusts the federal funds rate in an effort to keep inflation low and minimize any gap between potential GDP and real GDP. This reaction helps to mitigate the harmful economic and inflationary effects of the legislation.

 

Appendix 2: Key Economic Indicators

Table 2-1

Table 2-2

Table 2-3

Appendix 3 State Results

Table 3-1


[1]Scientific questions about global warming, its causes, and the seriousness of the consequences are not discussed in this report.

[2]The November 2008 baseline is used for this analysis. Heritage analysts relied on models maintained by IHS Global Insight, Inc., for developing the economic estimates reported in this paper. The IHS Global Insight model is used by private-sector and government economists to estimate how changes in the economy and public policy are likely to affect major economic indicators. The methodologies, assumptions, conclusions, and opinions presented here are entirely the work of analysts at The Heritage Foundation's Center for Data Analysis. They have not been endorsed by, and do not necessarily reflect the views of, the owners of the IHS Global Insight model.

[3]Note, even if allowances are not purchased explicitly, but given freely, the producer is now holding an allowance that could be sold and thus carries an opportunity cost. That is, the driver of the cost increases is not the cash payment of allowances, but the constraint on emissions. Contrary to popular belief, giving allowances for "free" does not mitigate this cost.

[4]The final legislation passed by the House called for slightly different allocations. While softening the impact for some groups at the expense of others matters for those affected groups, the macroeconomic impact of this rearrangement is not significantly changed. Again, the main driver of the economic impact is the artificial scarcity of emissions that constrains energy production and consumption. Without adequate energy levels, the economy slows down and resources are underused.

[5]For a full description and technical details of the simulation see Appendix 1.

[6]Heritage analysts relied on models maintained by IHS Global Insight, Inc., for developing the economic estimates reported in this paper. The IHS Global Insight model is used by private-sector and government economists to estimate how changes in the economy and public policy are likely to affect major economic indicators. The methodologies, assumptions, conclusions, and opinions presented here are entirely the work of analysts at The Heritage Foundation's Center for Data Analysis. They have not been endorsed by, and do not necessarily reflect the views of, the owners of the IHS Global Insight model.

[7]This incentive is policy-induced and is not driven by the real fundamental incentive of relative costs to relative benefits. Therefore, artificially increasing the price of carbon-based fuel in order to make alternative fuels more competitive is less efficient. It handicaps a competitive energy source so that a less competitive source has a chance, rather than making the less competitive source more competitive. Arguments that this is creating greater efficiency for clean energy are correct, but they miss the point that relative to the baseline, the economy is being forced to pay more for the same amount of energy or receive less of it, which means there is an overall negative impact on the economy.

[8]For detailed results of the simulation, see Appendix 2.

[9]For detailed state results of the simulation, see Appendix 3.

[10] For a discussion of why the allowances can be considered taxes, see "Congressional Budget Office Cost Estimate: H.R. 2454, American Clean Energy and Security Act of 2009," June 5, 2009, at http://www.cbo.gov/ftpdocs/102xx/doc10262/hr2454.pdf (July 25, 2009).

[11]For example, between 2005 and 2006 CO2 emissions decreased by 1.3 percent, while the U.S. economy grew by 3.3 percent. Only 0.9 percent of the decrease was due to a decrease in overall energy use during this time, which indicates that the U.S. economy is becoming less carbon-intensive even without more mandates. Margo Thorning, "The Impact of America's Climate Security Act of 2007 (S. 2191) on the U.S. Economy and on Global Greenhouse Gas Emissions," testimony before the Committee on Environmental and Public Works, U.S. Senate, November 8, 2007, at http://www.accf.org/pdf/test
-climate-security.pdf (July 28, 2009).

[12]"Obama: My Plan Makes Electricity Rates Skyrocket," YouTube, January 17, 2008, at http://www.youtube.com/watch?v=HlTxGHn4sH4 (July 25, 2009).

http://www.heritage.org/Research/EnergyandEnvironment/cda0904.cfm

[Body-by-Guinness]

Lawmakers' Global-Warming Trip Hit Tourist Hot Spots
Penguins, a Rocket-Propelled Airplane (and Tax Dollars) Also Involved
By BRODY MULLINS and T.W. FARNAM

WASHINGTON -- When 10 members of Congress wanted to study climate change, they did more than just dip their toes into the subject: They went diving and snorkeling at the Great Barrier Reef. They also rode a cable car through the Australian rain forest, visited a penguin rookery and flew to the South Pole.

The 11-day trip -- with six spouses traveling along as well -- took place over New Year's 2008. Details are only now coming to light as part of a Wall Street Journal analysis piecing together the specifics of the excursion.

It's tough to calculate the travel bills racked up by members of Congress, but one thing's for sure: They use a lot of airplanes. In recent days, House of Representatives members allocated $550 million to upgrade the fleet of luxury Air Force jets used for trips like these -- even though the Defense Department says it doesn't need all the planes.

The South Pole trip, led by Rep. Brian Baird (D., Wash.), ranks among the priciest. The lawmakers reported a cost to taxpayers of $103,000.

That figure, however, doesn't include the actual flying, because the trip used the Air Force planes, not commercial carriers. Flight costs would lift the total tab to more than $500,000, based on Defense Department figures for aircraft per-hour operating costs.

Lawmakers say the trip offered them a valuable chance to learn about global warming and to monitor how federal funds are spent. "The trip we made was more valuable than 100 hearings," said Rep. Baird, its leader. "Are there members of Congress who take trips somewhat recreationally? Perhaps. Is this what this trip was about? Absolutely not."

The knowledge gained is "profoundly important to how I do this job," added Mr. Baird, who at the time headed the House Science Committee's subcommittee on research and science education.

Other legislators agree it wasn't all fun and games. "There are a lot more glamorous things to do than hang out on the South Pole," said Rep. Frank Lucas, an Oklahoma Republican who traveled as well. "I never want to wear that many clothes again."

Taxpayer-funded travel for Congress is booming. Legislators and aides reported spending about $13 million on overseas trips last year, a Journal analysis has shown, a nearly 10-fold jump since 1995.

For Mr. Baird, the trip was one of two such excursions in six months. Last summer, he went to the Galapagos Islands with several lawmakers, also to gain expertise in climate change.

Other lawmakers have taken big-ticket trips. In June 2007, Ted Stevens, then a Republican senator from Alaska, and four other senators went to the Paris Air Show, costing the government $121,000 for hotels, meals and other expenses. Information needed to estimate their flight costs wasn't available.

Mr. Stevens said the purpose was to learn more about developments in aviation. "My state is very dependent on the industry" because many cities can be reached only by air, he said.

The 10 members of Congress gathered at Andrews Air Force Base in Maryland on the morning of Dec. 29, 2007, along with several of their staff. Those who brought spouses were four Democrats (Rep. Mike Ross of Arkansas, Rep. Russ Carnahan of Missouri, Rep. Charlie Melancon of Louisiana and Rep. John Tanner of Tennessee) and two Republicans (Rep. Randy Neugebauer of Texas and Mr. Lucas of Oklahoma). Spouses must pay for their own meals, but they don't have to pay for lodging and travel.

Asked about his wife's participation, Mr. Lucas cited a busy congressional schedule that often keeps families separated, even on weekends. If spouses couldn't go along on trips abroad, "then you couldn't travel -- simple as that," he said.

A spokeswoman for Mr. Melancon said the representative's wife of 37 years, Peachy Melancon, added "insight and perspective" that "only amplified the educational benefit he gained as a lawmaker."

Representatives for the other four who brought spouses declined to comment on doing so. Lawmakers said the trip offered them a valuable chance to learn about global warming and to monitor how federal funds are spent on scientific projects.

The party boarded a C-40, the military's business-class version of a Boeing 737. It is designed to be an "office in the sky" for government leaders, according to the Air Force Web site.

The lawmakers touched down at their first destination, Christchurch, New Zealand, a few hours before sunset on New Year's Eve. Mr. Baird watched the town's fireworks at midnight, his spokesman said.

The next day, Jan. 1, 2008, preparing for their South Pole trip, the lawmakers were provided clothing for extreme cold weather, including thermal underwear, according to the National Science Foundation.

Only lawmakers and staff were allowed to visit Antarctica; spouses stayed in New Zealand. The government doesn't pay for spouses' accommodations when the lawmakers aren't present.

On Jan. 2, the lawmakers and four aides flew to McMurdo Station in Antarctica on a supply flight, about 800 miles from the South Pole. "Take your camera to dinner," the itinerary reminded the travelers, for a post-meal tour of Discovery Hut, an outpost that was the launching pad for early South Pole expeditions.

The next day, the group left for the South Pole itself aboard a C-130 Hercules making a previously scheduled supply run. The aircraft was specially equipped with takeoff-boosting rockets and also skis for use on ice runways. The lawmakers toured the South Pole Station, including its post office. "Pre-address and pre-stamp any mail you wish to send from the South Pole," the itinerary reminded them. Scientists briefed them on research projects including a $271 million telescope buried in the ice that detects elementary particles passing through the Earth.

After flying back to McMurdo, they visited a penguin rookery to see the "threats to the wildlife," said a spokeswoman for the National Science Foundation.

They also spoke with National Aeronautics and Space Administration scientists there who hope to use the South Pole's frigid and hostile environment to test inflatable moon dwellings. "Some of the most important science in the world is being done down there," Mr. Baird said.

Next stop: Australia. The group took a boat trip to the Great Barrier Reef, where lawmakers spoke with scientists about research showing its vulnerability to climate change, according to the Science Committee's report.

Mr. Baird, a certified scuba diver, said he went on two shallow reef dives with scientists. Rep. Loretta Sanchez, a California Democrat, said she preferred to snorkel. Mr. Lucas said he didn't enjoy the boat trip because he hasn't spent much time on the water. The reef is one of the world's premier diving destinations.


Later, Mr. Baird made a third reef dive at his own expense to see first-hand the damage to coral reefs caused by tourism. Mr. Baird said he wanted to see evidence of coral bleaching, which some scientists say is caused by higher levels of carbon dioxide in the atmosphere. Mr. Baird blames increased carbon levels for a decline of shellfish in the Pacific Ocean near his district.

The tab for two days in Australia was more than $50,000, according to the travel-disclosure form. According to the document, the lawmakers spent $32,000 on hotels and meals, $7,000 on transportation and $10,000 for "other purposes." As on all such oversees trips, each lawmaker gets a daily stipend of $350 for incidentals, according to the form.

Mr. Baird said the travel report for Australia was inaccurate. His spokesman didn't respond to requests for details.

The trip ended with a layover in Hawaii to refuel the Air Force plane. There, lawmakers visited troops based at Hickman Air Force Base.

On the last night of their 11-day trip, the lawmakers stayed at the Royal Hawaiian Hotel in Waikiki. The spokesman for Mr. Baird said he would have been "every bit as happy camping as staying in a hotel."

Write to Brody Mullins at brody.mullins@wsj.com and T.W. Farnam at timothy.farnam@wsj.com

http://online.wsj.com/article/SB124967502810515267.html

[Body-by-Guinness]

Window Pain
Ashlea Ebeling, 08.24.09, 12:00 AM ET
Congress has a deal for you: Buy energy-efficient windows and get $1,500 knocked off your 2009 or 2010 federal tax bill via a credit included in last February's $787 billion stimulus. The catch? The windows that qualify for the credit might not be the most energy efficient.

This absurdity results from two bad congressional habits: micromanaging everything through the tax code and cutting last minute deals on 1,000-page bills. The deal involved coming up with a creative way to chop $2.4 billion from the $4.3 billion cost of a rational credit, one keyed to the Department of Energy's "Energy Star" certification. But rather than cut the size or dollar maximum for the new credit--it's equal to 30% of your first $5,000 in window spending--Congress adopted a new, tougher standard, so fewer windows would qualify.

The problem? Energy Star standards vary by region. Congress, in its wisdom, overrode them with one national standard in which windows are rated on both their ability to keep heat in and their ability to keep sunshine out. That works fine for, say, the mid-Atlantic, where about the same amount of energy is used for summer cooling and winter heating. But in colder climes the sun's heat is needed for warmth--meaning New Englanders will have to pump up their thermostat if they want a tax-credit window that does a good job at keeping the sun out. In warm states residents don't need windows that excel at trapping heat. "You don't want the same window in the far South and the far North," says Lowell Ungar, director of policy with the Alliance to Save Energy.

At least this stimulus has created a job: The Window & Door Manufacturers Association hired its first full-time Washington lobbyist, who is now pushing Congress to go back to standards that vary by region.

http://www.forbes.com/forbes/2009/0824/outfront-tax-credit-energy-star-window-pain.html?partner=contextstory

[Body-by-Guinness]

The high speed rail boondoggle

Rick Moran
The Obama administration, failing to learn the lessons of nearly 40 years of subsidizing Amtrak, is embarking on a huge high speed rail project that promises to spend tens of billions of dollars for meager benefits.

As Robert Samuelson points out in his Washington Post column, we have been subsidizing about 78,000 Amtrak users to the tune of about $50 per ride. The results? A negligible decrease in traffic congestion, and greenhouse gas emissions.

Ah! But high speed rail will be different says Obama/Biden:

The White House promises fabulous benefits. High-speed rail "will loosen the congestion suffocating our highways and skyways," says Vice President Biden. A high-speed rail system would eliminate carbon dioxide emissions "equal to removing 1 million cars from our roads," adds the president. Relieve congestion. Fight global warming. Reduce oil imports. The vision is seductive. The audience is willing. Many Americans love trains and regard other countries' systems (say, Spain's rapid trains between Madrid and Barcelona, running at about 150 mph) as evidence of U.S. technological inferiority.

There's only one catch: The vision is a mirage. The costs of high-speed rail would be huge, and the public benefits meager.

Samuelson looks at the astronomical costs of high speed rail:

President Obama's network may never be built. It's doubtful private investors will advance the money, and once government officials acknowledge the full costs, they'll retreat. In a recent report, the Government Accountability Office cited a range of construction costs, from $22 million a mile to $132 million a mile. Harvard economist Edward Glaeser figures $50 million a mile might be a plausible average. A 250-mile system would cost $12.5 billion and 10 systems, $125 billion.

That would be only the beginning. Ticket prices would surely be subsidized; otherwise, no one would ride the trains. Would all the subsidies be justified by public benefits -- less congestion, fewer highway accidents, lower greenhouse gases?

Obviously not, says Samuelson.

The Obama administration has already proposed spending $13 billion on high speed rail - $8 billion in the stimulus bill and another billion a year through 2013. As more money is poured down this black hole and costs skyrocket, the old gambit of "We've spent this much, might as well spend the rest" takes over and the entire, costly boondoggle gets built.

The prospect of subsidizing both Amtrak and this high speed rail system boggles the mind. For less than .002% of the commuting public, we will spend billions.

At least Joe Biden will get to ride his choo-choo real fast. Maybe the engineer will let him blow the horn.

Hat Tip: Ed Lasky






Page Printed from: http://www.americanthinker.com/blog/2009/08/the_high_speed_rail_boondoggle.html at August 24, 2009 - 10:37:09 AM EDT

[Body-by-Guinness]

Deep oil: a giant discovery

Thomas Lifson
BP has announced a "giant" oil discovery in the Gulf of Mexico, drilled to a total depth of 35,055 feet. Drilling began at a depth of 4,132 feet below the surface of the water. No further details of the magnitude of the discovery are being released. But this is further evidence that deep oil and gas deposits may dwarf the resources discovered at shallower depths.

More than two decades ago, people began noticing that shallower wells in the Gulf of Mexico that were thought to be exhausted seemed to be regenerating, with oil seeping upward from deposits below.  This observation, as well as the discovery of vast gas deposits at depths of 10,000 feet and more, has led to a theory that oil and gas deposits are not the fossilized remains of organic matter from the ancient surface of the earth, but are instead a product of organic processes at work underneath the surface of the planet.

The technology for drilling deep is improving, thanks to the work of geniuses in Houston and other locales. It still costs a lot to reach miles beneath the earth's surface. But with this much money at stake, and with the enticement of huge quantities of oil available, further progress in capability and cost can be expected.

Theorists who proclaim that oil production has peaked or soon will decline have got to hate this good news for oil consumers.

Page Printed from: http://www.americanthinker.com/blog/2009/09/deep_oil_a_giant_discovery.html at September 02, 2009 - 03:55:21 PM EDT

[Body-by-Guinness]

Spain's Solar-Power Collapse Dims Subsidy Model
By ANGEL GONZALEZ and KEITH JOHNSON

Spain's hopes of becoming a world leader in solar power have collapsed since the Spanish government slammed the brakes on generous subsidies.

The sudden change has rippled across the global solar industry, in a warning of the problems that government-supported renewable-energy programs can encounter.

In 2008, Spain accounted for half the world's new solar-power installations in terms of wattage, thanks to government subsidies to promote clean energy. But late last year, as the global economic crisis worsened, the government dramatically scaled back those subsidies and capped the amount of subsidized solar power that could be installed.

Factories world-wide that had ramped up production of solar-power components found that demand for solar panels was plummeting, leaving a glut in supply and pushing prices down. Job cuts followed.

"The solar industry in 2009 has been undermined by [a] collapse in demand due to the decision by Spain," says Henning Wicht, a solar-power analyst at research group iSuppli.

Spain is providing important lessons for the U.S., where lawmakers are engaged in a debate about how to support renewable energy. Boosters of clean energy, including President Barack Obama, have pointed to Spain as a success story showing how government policies jump-started renewable energy, created new industries, and helped the environment.

Spain's early bet on wind power paid off: The country is one of the world leaders in generating such power, only recently eclipsed by the U.S. Spanish wind-power companies have become global players. In 2008, wind power accounted for 11% of Spanish electricity production, compared to less than 1% for solar power.

Reyad Fezzani, chief executive of BP Solar, a unit of oil giant BP PLC, said that despite the current crisis, the Spanish model succeeded in creating a solar industry from scratch. "Once you pay for the infrastructure, you have a skilled work force and you can expand and contract very easily," he said.

Clean-energy skeptics, however, point to Spain as a cautionary tale of a government policy that created a speculative bubble with disastrous consequences. Some Republicans have cited Spain's solar bubble and bust as an example of how unsustainable government clean-energy pushes are.


The U.S. is experimenting with different ways to promote clean energy, including tax incentives and direct federal subsidies to defray installation costs, and mandates for utilities to get a certain amount of their power from renewable energy.

California and New Jersey, which lead the U.S. in solar power, are among states that have used subsidies similar to the ones in Spain to make solar power more attractive. Two House Democrats, Jay Inslee of Washington and Bill Delahunt of Massachusetts, are drafting legislation that would create European-style tariffs for solar power.

The industry's fundamental problem is that, without subsidies, it's still not economically viable.

Mike Ahearn, chief executive of Tempe, Arizona-based First Solar Corp., says solar power could be competitive "within a couple of years" -- but only if the industry gains scale. That would require generous government subsidies and other forms of support, Mr. Ahearn says: "It's a chicken-and-egg problem."

Spain's solar ambitions started as an outgrowth of its earlier push to become a global player in wind power. By offering generous long-term support for wind power, Spain became a world leader. Companies such as Iberdrola SA and Gamesa Corp. catapulted from their home market to the U.S.

Wind energy was a cheaper renewable option than solar, so the Spanish government sought to make solar power more attractive by increasing subsidies, just as other countries, particularly Germany, were scaling back support.

As a result, Spain's solar capacity last year increased to 3,342 megawatts from 695 megawatts, the size of a coal plant, a year earlier. Government subsidies for solar power jumped to €1.1 billion ($1.6 billion) in 2008 from €214 million in 2007.

Solar power "was a financial product, not an energy solution," says Ignacio Sánchez Galán, chairman of Iberdrola, the world's biggest renewable-energy company. Iberdrola has largely shunned solar because wind power is cheaper and requires less land.

That's especially true of the new wave of large-scale solar power, known as solar thermal power, which uses the sun to heat water into steam which runs turbines. That technology offers the potential for much bigger clean-energy projects than silicon-coated photovoltaic panels, and has attracted interest from utilities in Spain and the U.S., especially. But solar thermal power is far from being cost-competitive with traditional power sources, and it requires large swathes of empty land, such as those found in parts of Spain and the U.S. Southwest.

Faced with the unraveling world economy and a deepening budget deficit, the Spanish government late last year reduced the money it paid for solar electricity and capped the amount of subsidized solar power installed each year at 500 megawatts. Spain's solar-power capacity has actually shrunk this year as a result.

The effects have been felt far beyond Spain. China's Yingli Green Energy Holding Co., which makes solar-power components for export, posted a 43% slide in first-quarter earnings, in large part because Spain was no longer buying.

Yiyu Wang, Yingli's chief strategic officer, said the Spanish experience could teach governments around the world to undertake "more practical, more stable plans."

Solar makers such as Norway's Renewable Energy Corp., China's LDK Solar Co. and JA Solar Holdings Co. posted big second-quarter losses. German giant Q-Cells posted a first-half net loss of €697 million and plans to cut about 500 workers, about a fifth of its work force.

"We are without a doubt in a difficult situation," Q-Cells CEO Anton Milner wrote in a report to shareholders.

Write to Angel Gonzalez at angel.gonzalez@dowjones.com and Keith Johnson at keith.johnson@wsj.com

Printed in The Wall Street Journal, page A4

http://online.wsj.com/article/SB125193815050081615.html?ru=yahoo&mod=yahoo_hs

[Crafty_Dog]

U.K. committee recommends rationed air travel
Government advisers in the U.K. are warning that air travel in the future may have to be rationed to meet target emissions levels. "We have to think seriously about constraining demand and the way we do that is to have high fares to reflect carbon prices," said David Kennedy, chief of the Committee on Climate Change, in a letter to government ministers. "You may want to go on holiday more that you do now. But you may not be able to do that in a carbon-constrained world," Kennedy said. Telegraph (London)

[Boyo]

SPPI’s Monthly CO2 Report is now posted:http://scienceandpublicpolicy.org/monthly_report/august_co2_report.html

No heat buildup in the oceans = no global warming:
SPPI’s authoritative Monthly CO2 Report for August 2009 announces the publication of a major paper by Professors David Douglass and Robert Knox of the Physics Department in the University of Rochester, New York, demonstrating that the heat buildup in the oceans that is a necessary fingerprint of manmade global warming is not occurring. This is another mortal blow to the alarmist cause in the climate debate. Report, page 4.
“Science should be done by observation, meditation, calculation, and verification. Politicized science cannot usefully inform political decisions.” Editorial comment: Page 3.
The IPCC assumes CO2 concentration will reach 836 ppmv by 2100, but, for almost eight years, CO2 concentration has headed straight for only 570 ppmv by 2100. This alone halves all of the IPCC’s temperature projections. Pages 5-6.
Since 1980 temperature has risen at only 2.3 °F (1.4 °C)/century, not the 7 F° (3.9 C°) the IPCC predicts. Pages 7-9.
Sea level rose just 8 inches in the 20th century, and has scarcely risen since 2006. The oceans are not warming. Pages 10-11.
Arctic sea-ice extent is currently at its summer low, but there is more summer ice than there was in 2007 or 2008. In the Antarctic, sea ice extent reached a record high in 2007. Global sea ice extent shows little trend for 30 years. Pages 12-15.
Hurricane and tropical-cyclone activity is almost at its lowest since satellite measurement began. Pages 16-17.
The Sun is still very quiet. There were no sunspots in August at all. Page 18.
The (very few) benefits and the (very large) costs of the Waxman/Markey Bill are illustrated at Pages 19-21.
Science Focus this month reprints a paper giving the reasons why the great ice sheets will not collapse. Pages 22-28.
As always, there’s our “global warming” ready reckoner, and our monthly selection of scientific papers. Pages 29-34.
And finally, a Technical Note explains how we compile our state-of-the-art CO2 and temperature graphs. Page 35.

[Crafty_Dog]

Svensmark: “global warming stopped and a cooling is beginning” – “enjoy global warming while it lasts”
10 09 2009
This opinion piece from Professor Henrik Svensmark was published September 9th in the Danish newspaper Jyllands-Posten. Translation is from Google translation with some post translation cleanup of jumbled words or phrases by myself. In cases were the words were badly jumbled or didn’t quite make sense I inserted [my interpretation in brackets]. Hat tip to Carsten Arnholm of Norway for bringing this to my attention. – Anthony

 Spotless Cueball: Catania observatory photosphere image August 31st, 2009
While the sun sleeps

HENRIK SVENSMARK, Professor, DTU, Copenhagen

Indeed, global warming stopped and a cooling is beginning. No climate model has predicted a cooling of the Earth, on the contrary. This means that projections of future climate is unpredictable, writes Henrik Svensmark.

The star which keeps us alive, has over the last few years almost no sunspots, which are the usual signs of the sun’s magnetic activity.

Last week, reported the scientific team behind Sohosatellitten (Solar and Heliospheric Observatory) that the number of sunspot-free days suggest that solar activity is heading towards its lowest level in about 100 years’.  Everything indicates that the Sun is moving into a hibernation-like state, and the obvious question is whether it has any significance for us on Earth.

If you ask the International Panel on Climate Change IPCC, representing the current consensus on climate change, so the answer is a reassuring ‘nothing’. But history and recent research suggests that it is probably completely wrong. Let us take a closer look at why.

Solar activity has always varied.  Around the year 1000, we had a period of very high solar activity, which coincided with the medieval warmth. It was a period when frosts in May was an almost unknown phenomenon and of great importance for a good harvest.  Vikings settled in Greenland and explored the coast of North America. For example, China’s population doubled over this period.  But after about 1300, the earth began to get colder and it was the beginning of the period we now call the Little Ice Age. In this cold period  all the Viking settlements in Greenland disappeared. Swedes [were surprised to see Denmark to freeze over in ice], surprised the Danes by walking over the ice and the Thames in London froze repeatedly. But more serious was the long periods of crop failure, which resulted in a poorly nourished population, because of disease and hunger [population was reduced] by about 30 per cent in Europe.

It is important to note that the Little Ice Age was a global event. It ended in the late 19th century and was followed by an increase in solar activity. Over the past 50 years solar activity has been the highest since the medieval warmth for 1,000 years ago. And now it appears that the sun returns and is heading towards what is called ‘a grand minimum’ as we saw in the Little Ice Age.

The coincidence between solar activity and climate through the ages have tried explained away as coincidence. But it turns out that almost no matter what time studying, not just the last 1000 years, so there is a line. Solar activity has repeatedly over the past 10,000 years has fluctuated between high and low. Actually, the sun over the past 10,000 years spent in a sleep mode, approx. 17 pct of the time, with a cooling of the Earth to follow.

One can wonder that the international climate panel IPCC does not believe that the sun changed activity has no effect on the climate, but the reason is that they only include changes in solar radiation.

Just radiation would be the simplest way by which the sun could change the climate. A bit like turning up and down the brightness of a light bulb.

Satellite measurements of solar radiation has been shown that the variations are too small to cause climate change, but so has closed his eyes for a second much more powerful way the sun is able to affect Earth’s climate. In 1996 we discovered a surprising influence of the sun – its impact on Earth’s cloud cover.  High energy accelerated particles of exploded stars, the cosmic radiation, are helping to form clouds.

When the Sun is active its magnetic field shields better against the cosmic rays from outer space before they reach our planet, and by regulating the Earth’s cloud cover the sun can turn up and down the temperature. High solar activity obtained fewer clouds and the earth is getting warmer.  Low solar activity inferior shields against cosmic radiation, and it results in increased cloud cover and hence a cooling. As the sun’s magnetism has doubled its strength during the 20th century, this natural mechanism may be responsible for a large part of global warming during this period.

This also explains why most climate scientists are trying to ignore this possibility.  It does in fact favor the idea that the 20th century temperature rise is mainly due to human emissions of CO2.  If the sun as has influenced a significant part of warming in the 20 century, it means that CO2’s contribution must necessarily be smaller.

Ever since our theory was put forward in 1996, it has been through a very sharp criticism, which is normal in science.

First it was said that a link between clouds and solar activity could not be correct because no physical mechanism was known. But in 2006 after many years of work we managed to conduct experiments at DTU Space, where we demonstrated the existence of a physical mechanism. The cosmic radiation helps to form aerosols, which are the seeds for cloud formation.

Then came the criticism that the mechanism we have found in the laboratory was unable to survive in the real atmosphere and therefore had no practical significance.  But the criticism we have just emphatically rejected. It turns out that the sun itself is doing, what we might call natural experiments. Giant solar flares can have the cosmic radiation on earth to dive suddenly over a few days. In the days after the eruption cloud cover falls by about 4 per cent. And the content of liquid water in clouds (droplets) is reduced by almost 7 per cent.  Indeed, [you could say] that the clouds on Earth originated in space.

Therefore we have looked at the sun’s magnetic activity with increasing concern, since it began to wane in the mid-1990s.

That the sun could fall asleep in a deep minimum was suggested by [solar scientists] at a meeting in Kiruna in Sweden two years ago. As Nigel Calder and I updated our book “The Chilling Stars” therefore, we wrote a little provocative [passage] “we recommend our friends to enjoy global warming while it lasts.”

Indeed, global warming stopped and a cooling is beginning.  Last week, it was argued by Mojib Latif from the University of Kiel at the UN World Climate Conference in Geneva that cooling may continue through the next 10 to 20 years.

His explanation was natural changes in North Atlantic circulation and not in solar activity. But no matter how it is interpreted,  the natural variations in climate then penetrates more and more.

One consequence may be that the sun itself will show its importance for climate and thus to test the theories of global warming. No climate model has predicted a cooling of the Earth, on the contrary.

This means that projections of future climate is unpredictable. A forecast [that] says it may be warmer or colder for 50 years, is not very useful, for science is not able to predict solar activity.

So in many ways, we stand at a crossroads. The near future will be extremely interesting and I think it is important to recognize that nature is completely independent of what we humans think about it. Will Greenhouse theory survive a significant cooling of the Earth? Not in its current dominant form. Unfortunately, tomorrow’s climate challenges will be quite different than greenhouse theory’s predictions, and perhaps it becomes again popular to investigate the sun’s impact on climate.

Professor Henrik Svensmark is director of the Center for Sun-Climate Research at DTU Space. His book “The Chilling Stars” has also been published in Danish as “Climate and the Cosmos” (Gads Forlag, DK ISBN 9788712043508)

[Crafty_Dog]

second post of the morning


 
 
 
Solar wind surprise: “This discovery is like finding it got hotter when the sun went down,”
10 09 2009
This gives a whole new meaning to “Total Solar Irradiance”. Instead of TSI, perhaps we should call the energy transfer that comes from the sun to the earth TSE for “Total Solar Energy” so that it includes the solar wind, the geomagnetics, and other yet undiscovered linkages. Jack Eddy is smiling and holding up the patch cord he’s been given at last, wondering how long it will be before we find all the connectors.



Scientists discover surprise in Earth’s upper atmosphere

From the UCLA Newsroom: By Stuart Wolpert

UCLA atmospheric scientists have discovered a previously unknown basic mode of energy transfer from the solar wind to the Earth’s magnetosphere. The research, federally funded by the National Science Foundation, could improve the safety and reliability of spacecraft that operate in the upper atmosphere.

“It’s like something else is heating the atmosphere besides the sun. This discovery is like finding it got hotter when the sun went down,” said Larry Lyons, UCLA professor of atmospheric and oceanic sciences and a co-author of the research, which is in press in two companion papers in the Journal of Geophysical Research.

The sun, in addition to emitting radiation, emits a stream of ionized particles called the solar wind that affects the Earth and other planets in the solar system. The solar wind, which carries the particles from the sun’s magnetic field, known as the interplanetary magnetic field, takes about three or four days to reach the Earth. When the charged electrical particles approach the Earth, they carve out a highly magnetized region — the magnetosphere — which surrounds and protects the Earth.

Charged particles carry currents, which cause significant modifications in the Earth’s magnetosphere. This region is where communications spacecraft operate and where the energy releases in space known as substorms wreak havoc on satellites, power grids and communications systems.

The rate at which the solar wind transfers energy to the magnetosphere can vary widely, but what determines the rate of energy transfer is unclear.

“We thought it was known, but we came up with a major surprise,” said Lyons, who conducted the research with Heejeong Kim, an assistant researcher in the UCLA Department of Atmospheric and Oceanic Sciences, and other colleagues.

“This is where everything gets started,” Lyons said. “Any important variations in the magnetosphere occur because there is a transfer of energy from the solar wind to the particles in the magnetosphere. The first critical step is to understand how the energy gets transferred from the solar wind to the magnetosphere.”

The interplanetary magnetic field fluctuates greatly in magnitude and direction.

 
Heejeong Kim and Larry Lyons

“We all have thought for our entire careers — I learned it as a graduate student — that this energy transfer rate is primarily controlled by the direction of the interplanetary magnetic field,” Lyons said. “The closer to southward-pointing the magnetic field is, the stronger the energy transfer rate is, and the stronger the magnetic field is in that direction. If it is both southward and big, the energy transfer rate is even bigger.”

However, Lyons, Kim and their colleagues analyzed radar data that measure the strength of the interaction by measuring flows in the ionosphere, the part of Earth’s upper atmosphere ionized by solar radiation. The results surprised them.

“Any space physicist, including me, would have said a year ago there could not be substorms when the interplanetary magnetic field was staying northward, but that’s wrong,” Lyons said. “Generally, it’s correct, but when you have a fluctuating interplanetary magnetic field, you can have substorms going off once per hour.

“Heejeong used detailed statistical analysis to prove this phenomenon is real. Convection in the magnetosphere and ionosphere can be strongly driven by these fluctuations, independent of the direction of the interplanetary magnetic field.”

Convection describes the transfer of heat, or thermal energy, from one location to another through the movement of fluids such as liquids, gases or slow-flowing solids.

“The energy of the particles and the fields in the magnetosphere can vary by large amounts. It can be 10 times higher or 10 times lower from day to day, even from half-hour to half-hour. These are huge variations in particle intensities, magnetic field strength and electric field strength,” Lyons said.

The magnetosphere was discovered in 1957. By the late 1960s, it had become accepted among scientists that the energy transfer rate was controlled predominantly by the interplanetary magnetic field.

Lyons and Kim were planning to study something unrelated when they made the discovery.

“We were looking to do something else, when we saw life is not the way we expected it to be,” Lyons said. “The most exciting discoveries in science sometimes just drop in your lap. In our field, this finding is pretty earth-shaking. It’s an entire new mode of energy transfer, which is step one. The next step is to understand how it works. It must be a completely different process.”

The National Science Foundation has funded ground-based radars which send off radio waves that reflect off the ionosphere, allowing scientists to measure the speed at which the ions in the ionosphere are moving.

The radar stations are based in Greenland and Alaska. The NSF recently built the Poker Flat Research Range north of Fairbanks.

“The National Science Foundation’s radars have enabled us to make this discovery,” Lyons said. “We could not have done this without them.”

The direction of the interplanetary magnetic field is important, Lyons said. Is it going in the same direction as the magnetic field going through the Earth? Does the interplanetary magnetic field connect with the Earth’s magnetic field?

“We thought there could not be strong convection and that the energy necessary for a substorm could not develop unless the interplanetary magnetic field is southward,” Lyons said. “I’ve said it and taught it. Now I have to say, ‘But when you have these fluctuations, which is not a rare occurrence, you can have substorms going off once an hour.’”

Lyons and Kim used the radar measurements to study the strength of the interaction between the solar wind and the Earth’s magnetosphere.

One of their papers addresses convection and its affect on substorms to show it is a global phenomenon.

“When the interplanetary magnetic field is pointing northward, there is not much happening, but when the interplanetary magnetic field is southward, the flow speeds in the polar regions of the ionosphere are strong. You see much stronger convection. That is what we expect,” Lyons said. “We looked carefully at the data, and said, ‘Wait a minute! There are times when the field is northward and there are strong flows in the dayside polar ionosphere.’”

The dayside has the most direct contact with the solar wind.

“It’s not supposed to happen that way,” Lyons said. “We want to understand why that is.”

“Heejeong separated the data into when the solar wind was fluctuating a lot and when it was fluctuating a little,” he added. “When the interplanetary magnetic field fluctuations are low, she saw the pattern everyone knows, but when she analyzed the pattern when the interplanetary magnetic field was fluctuating strongly, that pattern completely disappeared. Instead, the strength of the flows depended on the strength of the fluctuations.

“So rather than the picture of the connection between the magnetic field of the sun and the Earth controlling the transfer of energy by the solar wind to the Earth’s magnetosphere, something else is happening that is equally interesting. The next question is discovering what that is. We have some ideas of what that may be, which we will test.”

[Crafty_Dog]

Energy 'Sprawl' and the Green Economy
We're about to destroy the environment in the name of saving it

 Text  .By LAMAR ALEXANDER

Secretary of the Interior Ken Salazar recently announced plans to cover 1,000 square miles of land in Nevada, Arizona, California, Colorado, New Mexico and Utah with solar collectors to generate electricity. He's also talking about generating 20% of our electricity from wind. This would require building about 186,000 50-story wind turbines that would cover an area the size of West Virginia not to mention 19,000 new miles of high-voltage transmission lines.

Is the federal government showing any concern about this massive intrusion into the natural landscape? Not at all. I fear we are going to destroy the environment in the name of saving the environment.

The House of Representatives has passed climate legislation that started out as an attempt to reduce carbon emissions. It has morphed into an engine for raising revenues by selling carbon dioxide emission allowances and promoting "renewable" energy.

The bill requires electric utilities to get 20% of their power mostly from wind and solar by 2020. These renewable energy sources are receiving huge subsidies all to supposedly create jobs and hurry us down the road to an America running on wind and sunshine described in President Barack Obama's Inaugural Address.

Yet all this assumes renewable energy is a free lunch a benign, "sustainable" way of running the country with minimal impact on the environment. That assumption experienced a rude awakening on Aug. 26, when The Nature Conservancy published a paper titled "Energy Sprawl or Energy Efficiency: Climate Policy Impacts on Natural Habitat for the United States of America." The report by this venerable environmental organization posed a simple question: How much land is required for the different energy sources that power the country? The answers deserve far greater public attention.

By far nuclear energy is the least land-intensive; it requires only one square mile to produce one million megawatt-hours per year, enough electricity for about 90,000 homes. Geothermal energy, which taps the natural heat of the earth, requires three square miles. The most landscape-consuming are biofuels ethanol and biodiesel which require up to 500 square miles to produce the same amount of energy.

Coal, on the other hand, requires four square miles, mainly for mining and extraction. Solar thermal heating a fluid with large arrays of mirrors and using it to power a turbine takes six. Natural gas needs eight and petroleum needs 18. Wind farms require over 30 square miles.

This "sprawl" has been missing from our energy discussions. In my home state of Tennessee, we just celebrated the 75th Anniversary of the Great Smoky Mountains National Park. Yet there are serious proposals by energy developers to cover mountains all along the Appalachian chain, from Maine to Georgia, with 50-story wind turbines because the wind blows strongest across mountaintops.

Let's put this into perspective: We could line 300 miles of mountaintops from Chattanooga, Tenn., to Bristol, Va., with wind turbines and still produce only one-quarter the electricity we get from one reactor on one square mile at the Tennessee Valley Authority's Watts Bar Nuclear Plant.

The 1,000 square-mile solar project proposed by Mr. Salazar would generate, on a continuous basis, 35,000 megawatts of electricity. You could get the same output from 30 new nuclear reactors that would fit comfortably onto existing nuclear sites. And this doesn't count the thousands of miles of transmission lines that will be needed to carry the newly generated solar power to population centers.

There's one more consideration. Solar collectors must be washed down once a month or they collect too much dirt to be effective. They also need to be cooled by water. Where amid the desert and scrub land will we find all that water? No wonder the Wildlife Conservancy and other environmentalists are already opposing solar projects on Western lands.

Renewable energy is not a free lunch. It is an unprecedented assault on the American landscape. Before we find ourselves engulfed in energy sprawl, it's imperative we take a closer look at nuclear power.

Mr. Alexander is a Republican senator from Tennessee and a member of the Senate Environment and Public Works Committee.

[Body-by-Guinness]

http://www.reason.com/news/show/136265.html


Alaskan Oil Abundance Versus Washington's Wasted Billions

The case for new oil drilling in Alaska and off America's coasts

Jon Basil Utley | September 22, 2009

Oil imports now count for almost 80 percent of American consumption and cost some $300 to $400 billion yearly. They wreck our trade balance, subsidize many of our enemies, and add to our already mountainous foreign debt.

For political reasons, Venezuela, Nigeria, and Mexico—all major sources of U.S. oil imports—have suffered precipitous declines in production, with scant hope of recovering soon. Russian oil production is limited by government incompetence and lack of re-investment. Iraq's vast oil potential is paralyzed by political strife. At any moment, Iran might be attacked by Israel or America which would shut down its production. Further, Iran has threatened to retaliate against any attack by blockading the narrow passage in the Arabian Gulf through which most Saudi Arabian and Kuwaiti oil flows.

Analysts are already forecasting 100-dollar-a-barrel oil within a year. Yet the Obama administration is still blocking offshore drilling in America—even though it was approved by Congress last year—and wants to raise taxes on oil companies. Several years are needed to get major new production on line, even without anticipated environmental lawsuits designed to stymie or at least harass and delay any drilling of new wells off of America's east and west coasts.

In Alaska, we have a pipeline which could flow another 1.5 million barrels per day—worth nearly $50 billion per year—from vast oil resources waiting to be drilled. Oil appears to be abundant all the way across Northern Alaska from the Canadian border, where British Petroleum (BP) spent a billion dollars for new Canadian leases, to the shallow Chukchi Sea near the border with Russia, where test drilling is planned for next year.

New oil drilling in Alaska and off America's coasts would create hundreds of thousands of American jobs and billions of dollars in real tax revenue for Washington. Compare that to government spending to create jobs, which costs some $200,000 per job. Furthermore, administration claims for alternative energy rarely mention the billions of dollars in subsidies, lost tax revenue, and new government debt they require. 

For example, solar power involves billions of dollars in costly subsidies which add to the ballooning budget and trade deficits, as many of the panels are imported. A 30 percent tax credit comes right off an installer's income taxes. Giant companies such as Florida Power & Light, for example, now pay much lower income taxes mainly because of the credits.

Wind farms receive a 30 percent cash subsidy from the government in a program estimated to soon cost taxpayers some $10 billion, according to the Wall Street Journal. And billions more in government financing will still be needed to build transmission lines from out-of-the-way locations. Ethanol was similarly hyped by Washington—another gigantic political boondoggle with severely damaging consequences for food prices and tens of billions of dollars of wasted resources. Making gasoline economically from switch grass and other plants remains another pipe dream.

Major technological breakthroughs make vast new oil production possible—once Washington permits it. Natural gas is already abundant and promises to stay cheap into the foreseeable future (see my previous article at Reason.com, "The Coming Energy Abundance"). Many trucks, buses, and taxis could be easily converted to run on natural gas, costing less than a dollar a gallon for the energy equivalent of gasoline or diesel oil. According to USA Today, there exists tremendous potential for natural gas in auto and truck engines, which consume some 20 percent of all the fuel used on highways. Still, nothing compares to oil products for most transport needs. They are relatively safe, easy to store and divide up, and easy to transport.

For oil, extended reach drilling has made vast new production possible. BP is now drilling eight miles out from a manmade island off Alaska's shallow Arctic coastal plain. Artificial islands might even allow new wells to reach under the potentially vast ANWR oil fields from offshore, although less costly exploratory wells would first have to be drilled from sites on the ANWR preserve.

Horizontal drilling allows wells to reach out into oil reserves as never before and to produce far more oil from each field. Multiple extensions can also be drilled sideways out from a single vertical well. Until a few years ago all oil wells were vertical. For comparison, a traditional vertical well might expose 2 to 300 feet of reservoir rock. A new well using multiple horizontal sections can expose over 20,000 feet of reservoir rock, according to the BP's publication Arctic Energy. The process is called coiled tubing drilling. It is vastly increasing production and lowering costs. 

The 800-mile-long Alyeska Pipeline from Northern Alaska is now flowing at 600,000 barrels per day-its original capacity was over 2 million. BP expects its new offshore island to produce at least 40,000 barrels per day while the new Alpine field of Conoco Phillips Company is already producing some 110,000 barrels per day. The companies are also working on producing some of the billions of barrels of unused heavy oil from Alaska's Prudhoe Bay, trying to develop technologies to mix it with lighter hydrocarbons so it can flow through the pipeline. These numbers give some idea of how the pipeline might again be filled to capacity, assuming that ANWR production is permitted by Washington. 

Meanwhile, the Obama Administration is a prisoner of its "base," which includes extreme environmentalists doing all they can to delay and handicap new oil and gas drilling. If just a fraction of the $700 billion stimulus bill was spent on subsidizing natural gas fueling facilities at interstate truck stops, America could use more of its natural gas to avoid tens of billions of dollars of oil imports.

Moreover, none of the above addresses the new technology in nuclear electric power generation.  Small, factory built reactors could be operational by 2018. They could supplement or replace costly giant plants which now take 10 years for approval and construction. Low cost energy abundance is again well possible for America.

Jon Basil Utley is associate publisher of The American Conservative. He was a foreign correspondent for Knight Ridder newspapers and former associate editor of The Times of the Americas. For 17 years, he was a commentator for the Voice of America. In the 1980s, he owned and operated a small oil drilling partnership in Pennsylvania.

[ccp]

***scientific american
From the October 2009 Scientific American Magazine Another Century of Oil? Getting More from Current Reserves ( Preview )
Amid warnings of a possible "peak oil," advanced technologies offer ways to extract every last possible drop
By Leonardo Maugeri   

  Forecasts that global oil production will soon start to decline and that most oil will be gone within a few decades may be overly pessimistic. The author predicts that by 2030, thanks to advanced technologies, wells will be able to extract half of the oil known to be underground, up from the current average of 35 percent. Together with new discoveries, the increased productivity could make oil last at least another century. More from the Magazine
On fourteen dry, flat square miles of California’s Central Valley, more than 8,000 horsehead pumps—as old-fashioned oilmen call them—slowly rise and fall as they suck oil from underground. Glittering pipelines crossing the whole area suggest that the place is not merely a relic of the past. But even to an expert’s eyes, Kern River Oil Field betrays no hint of the technological miracles that have enabled it to survive decades of dire predictions.

When Kern River Oil Field was discovered in 1899, analysts thought that only 10 percent of its unusually viscous crude could be recovered. In 1942, after more than four decades of modest production, the field was estimated to still hold 54 million barrels of recoverable oil, a fraction of the 278 million barrels already recovered. “In the next 44 years, it produced not 54 [million barrels] but 736 million barrels, and it had another 970 million barrels remaining,” energy guru Morris Adelman noted in 1995. But even this estimate proved wrong. In November 2007 U.S. oil giant Chevron, by then the field’s operator, announced that cumulative production had reached two billion barrels. Today Kern River still puts out nearly 80,000 barrels per day, and the state of California estimates its remaining reserves to be about 627 million barrels. ***

I can't post the rest of the article but the author gives a compelling reason why we have far more oil available then present estimates.
We always find more than expected.

[Crafty_Dog]

The New Sputnik
               THOMAS L. FRIEDMAN
Published: September 26, 2009

Most people would assume that 20 years from now when historians look back at 2008-09, they will conclude that the most important thing to happen in this period was the Great Recession. I’d hold off on that. If we can continue stumbling out of this economic crisis, I believe future historians may well conclude that the most important thing to happen in the last 18 months was that Red China decided to become Green China.

Yes, China’s leaders have decided to go green — out of necessity because too many of their people can’t breathe, can’t swim, can’t fish, can’t farm and can’t drink thanks to pollution from its coal- and oil-based manufacturing growth engine. And, therefore, unless China powers its development with cleaner energy systems, and more knowledge-intensive businesses without smokestacks, China will die of its own development.

What do we know about necessity? It is the mother of invention. And when China decides it has to go green out of necessity, watch out. You will not just be buying your toys from China. You will buy your next electric car, solar panels, batteries and energy-efficiency software from China.

I believe this Chinese decision to go green is the 21st-century equivalent of the Soviet Union’s 1957 launch of Sputnik — the world’s first Earth-orbiting satellite. That launch stunned us, convinced President Eisenhower that the U.S. was falling behind in missile technology and spurred America to make massive investments in science, education, infrastructure and networking — one eventual byproduct of which was the Internet.

Well, folks. Sputnik just went up again: China’s going clean-tech. The view of China in the U.S. Congress — that China is going to try to leapfrog us by out-polluting us — is out of date. It’s going to try to out-green us. Right now, China is focused on low-cost manufacturing of solar, wind and batteries and building the world’s biggest market for these products. It still badly lags U.S. innovation. But research will follow the market. America’s premier solar equipment maker, Applied Materials, is about to open the world’s largest privately funded solar research facility — in Xian, China.

“If they invest in 21st-century technologies and we invest in 20th-century technologies, they’ll win,” says David Sandalow, the assistant secretary of energy for policy. “If we both invest in 21st-century technologies, challenging each other, we all win.”

Unfortunately, we’re still not racing. It’s like Sputnik went up and we think it’s just a shooting star. Instead of a strategic response, too many of our politicians are still trapped in their own dumb-as-we-wanna-be bubble, where we’re always No. 1, and where the U.S. Chamber of Commerce, having sold its soul to the old coal and oil industries, uses its influence to prevent Congress from passing legislation to really spur renewables. Hat’s off to the courageous chairman of Pacific Gas and Electric, Peter Darbee, who last week announced that his huge California power company was quitting the chamber because of its “obstructionist tactics.” All shareholders in America should ask their C.E.O.’s why they still belong to the chamber.

China’s leaders, mostly engineers, wasted little time debating global warming. They know the Tibetan glaciers that feed their major rivers are melting. But they also know that even if climate change were a hoax, the demand for clean, renewable power is going to soar as we add an estimated 2.5 billion people to the planet by 2050, many of whom will want to live high-energy lifestyles. In that world, E.T. — or energy technology — will be as big as I.T., and China intends to be a big E.T. player.

“For the last three years, the U.S. has led the world in new wind generation,” said the ecologist Lester Brown, author of “Plan B 4.0.” “By the end of this year, China will bypass us on new wind generation so fast we won’t even see it go by.”

I met this week with Shi Zhengrong, the founder of Suntech, already the world’s largest manufacturer of solar panels. Shi recalled how, shortly after he started his company in Wuxi, nearby Lake Tai, China’s third-largest freshwater lake, choked to death from pollution.

“After this disaster,” explained Shi, “the party secretary of Wuxi city came to me and said, ‘I want to support you to grow this solar business into a $15 billion industry, so then we can shut down as many polluting and energy consuming companies in the region as soon as possible.’ He is one of a group of young Chinese leaders, very innovative and very revolutionary, on this issue. Something has changed. China realized it has no capacity to absorb all this waste. We have to grow without pollution.”

Of course, China will continue to grow with cheap, dirty coal, to arrest over-eager environmentalists and to strip African forests for wood and minerals. Have no doubt about that. But have no doubt either that, without declaring it, China is embarking on a new, parallel path of clean power deployment and innovation. It is the Sputnik of our day. We ignore it at our peril.

[Boyo]

This comes from the Heritage Foundation:

President Obama’s speech to the UN on climate change last Tuesday points to an interesting and fairly recent shift in the left’s environmentalist philosophy: the definition of “pollution” has changed. Even ten years ago, concerns for pollution centered around problems of smog, litter, and toxins in the air and water. However, such concerns for largely visible pollution have been trumped recently by a concern for invisible pollution which Obama claims is the most dangerous of all: “greenhouse gas pollution” and “carbon pollution.”

While most visitors to the state of Wyoming marvel at miles of sparsely populated natural beauty, rolling mountains, open spaces, and clean air and water, environmentalists do not praise Wyoming but censure the state for its heavy coal development. In fact, Jeremy Nichols of WildEarth Guardians disapprovingly called the state “ground zero for greenhouse emissions.”

Ironically, one of the cleanest and most beautiful states in the union is labeled by environmentalists as the most persistent offender of the environment.


Wyoming produces the most coal in the United States, even though many other states have much greater coal reserves: Montana, for instance, has a lot more coal reserves but Wyoming produces ten times more coal. Wyoming also produces three times more coal than West Virginia - the second highest coal producing state.

Wyoming happens to have one of the healthiest economies in the union, and much of this economic success is due the energy development industry. Although the economy fluctuates with energy markets, Wyoming’s unemployment rates are consistently low; in August it was 5.7% compared to the 9.5% of the country. Wyoming also enjoyed a budget surplus in 2003 and 2005 and it continues to do well, achieving a balanced budget in 2009.

Wyoming may be “ground zero for greenhouse emissions” yet it is a state that has managed to wed clean air and water with a healthy economy. In the wake of onerous cap and trade philosophies, which will severely tax oil and coal production, dramatically raise energy prices, serve a huge blow to the economy, and only cool the earth’s temperature by a fraction of a degree, Wyoming provides us with food for thought on how we can be environmentally clean and economically prosperous.

Katie Brown contributed to this post.


Boyo

[Boyo]

this just makes me say WTF:

John Kerry: ‘Cap-and-trade’ is out
September 28, 2009 Democrats are trying yet another name change in their quest to cripple the American economy with greenhouse gas regulations.

Sen. John Kerry announced last week that the Senate climate bill due out this week will be a “pollution reduction” bill not a “cap-and-trade” bill. According to E&E Daily, Kerry said,

“I don’t know what ‘cap and trade’ means. I don’t think the average American does. This is not a cap-and-trade bill, it’s a pollution reduction bill.”

So the Democrats have gone from “global warming” to “climate change” to “clean energy” because the public doesn’t buy what they’re selling. Now they’re jettisoning “cap-and-trade” hoping that some other name will stick to the wall.

While Democrats can call economically disastrous carbon caps whatever they want, they can’t buff the cap-and-trade turd or any other carbon cap regime into a public policy popsicle.

Hey John, why don’t you just call it the “Free Candy for Everybody Act of 2009″?

[Body-by-Guinness]

Drill
Petroleum is a major part of America’s energy picture. Shall we get it here or abroad?

By Sarah Palin

Given that we’re spending billions of stimulus dollars to rebuild our highways, it makes sense to think about what we’ll be driving on them. For years to come, most of what we drive will be powered, at least in part, by diesel fuel or gasoline. To fuel that driving, we need access to oil. The less use we make of our own reserves, the more we will have to import, which leads to a number of harmful consequences. That means we need to drill here and drill now.

We rely on petroleum for much more than just powering our vehicles: It is essential in everything from jet fuel to petrochemicals, plastics to fertilizers, pesticides to pharmaceuticals. Ac cord ing to the Energy Information Ad min is tra tion, our total domestic petroleum consumption last year was 19.5 million barrels per day (bpd). Motor gasoline and diesel fuel accounted for less than 13 million bpd of that. Meanwhile, we produced only 4.95 million bpd of domestic crude. In other words, even if we ran all our vehicles on something else (which won’t happen anytime soon), we would still have to depend on imported oil. And we’ll continue that dependence until we develop our own oil resources to their fullest extent.

Those who oppose domestic drilling are motivated primarily by environmental considerations, but many of the countries we’re forced to import from have few if any environmental-protection laws, and those that do exist often go unenforced. In effect, American environmentalists are preventing responsible development here at home while supporting irresponsible development overseas.

My home state of Alaska shows how it’s possible to be both pro-environment and pro-resource-development. Alaskans would never support anything that endangered our pristine air, clean water, and abundant wildlife (which, among other things, provides many of us with our livelihood). The state’s government has made safeguarding resources a priority; when I was governor, for instance, we created a petroleum-systems-integrity office to monitor our oil and gas infrastructure for any potential environmental risks.

Alaska also shows how oil drilling is thoroughly compatible with energy conservation and renewable-energy development. Over 20 percent of Alas ka’s electricity currently comes from renewable sources, and as governor I put forward a long-term plan to increase that figure to 50 percent by 2025. Alaska’s comprehensive plan identifies renewable options across the state that can help rural villages transition away from expensive diesel-generated electricity — allowing each community to choose the solution that best fits its needs. That’s important in any energy plan: Tempting as they may be to central planners, top-down, one-size-fits-all solutions are recipes for failure.

For the same reason, the federal government shouldn’t push a single, uni versal approach to alternative-powered vehicles. Electric cars might work in Los Angeles, but they don’t work in Alaska, where you can drive hundreds of miles without seeing many people, let alone many electrical sockets. And while electric and hybrid cars have their advantages, producing the electricity to power them still requires an energy source. For the sake of the environment, that energy should be generated from the cleanest source available.

Natural gas is one promising clean alternative. It contains fewer pollutants than other fossil fuels, it’s easier to collect and process, and it is found throughout our country. In Alaska, we’re developing the largest private-sector energy project in history — a 3,000-mile, $40 billion pipeline to transport hundreds of trillions of cubic feet of natural gas to markets across the United States. Onshore and offshore na tural gas from Alaska and the Lower 48 can satisfy a large part of our energy needs for decades, bringing us closer to energy independence. Whether we use it to power natural-gas cars or to run natural-gas power plants that charge electric cars — or ideally for both — natural gas can act as a clean “bridge fuel” to a future when more renewable sources are available.

In addition to drilling, we need to build new refineries. America currently has roughly 150 refineries, down from over 300 in the 1970s. Due mainly to environmental regulations, we haven’t built a major new refinery since 1976, though our oil consumption has increased significantly since then. That’s no way to secure our energy supply. The post-Katrina jump in gas prices proved that we can’t leave ourselves at the mercy of a hurricane that knocks a few refineries out of commission.

Building an energy-independent Amer ica will mean a real economic stimulus. It will mean American jobs that can never be shipped overseas. Think about how much of our trade deficit is fueled by the oil we import — sometimes as much as half of the total. Through this massive transfer of wealth, we lose hundreds of billions of dollars a year that could be invested in our economy. Instead it goes to foreign countries, including some repressive regimes that use it to fund activities that threaten our security.

Reliance on foreign sources of energy weakens America. When a riot breaks out in an OPEC nation, or a developing country talks about nationalizing its oil industry, or a petro-dictator threatens to cut off exports, the probability is great that the price of oil will shoot up. Even in friendly nations, business and financial decisions made for local reasons can de stabilize America’s energy market, since the price we pay for foreign oil is subject to rising and falling exchange rates. Decreasing our dependence on foreign sources of energy will reduce the impact of world events on our economy.

In the end, energy independence is not just about the environment or the economy. It’s about freedom and confidence. It’s about building a more secure and peaceful America, an America in which our energy needs will not be subject to the whims of nature, currency speculators, or madmen in possession of vast oil reserves.

Alternative sources of energy are part of the answer, but only part. There’s no getting around the fact that we still need to “drill, baby, drill!” And if those in D.C. say otherwise, we need to tell them: “Yes, we can!”

— Sarah Palin was governor of Alaska from 2006 to 2009, and the Republican candidate for vice president in 2008. This article appears in the November 2, 2009, issue of National Review.

National Review Online - http://article.nationalreview.com/?q=Nzc2ZjhjY2MwMWUyM2M4NTM5YWRjYTcwMTEzZTNjMTc=

[Body-by-Guinness]

Wouldn't it be amusing if our current, misguided energy policy left us on top of huge reserves we could charge high prices for down the line?

U.S. Tops in Energy Resources
by Human Events (more by this author)
Posted 11/02/2009 ET
Updated 11/02/2009 ET

The United States has largest energy reserves on Earth, according to a report from the Congressional Research Service.

As shown in the charts below, the U.S. has 1,321 billion barrels of oil (or barrels of oil equivalent for other sources of energy) when combining its recoverable natural gas, oil and coal reserves.

While Russia is a close second with 1,248 billion barrels, other energy producing nations are far behind. No. 3 is Saudi Arabia (543 billion barrels), followed by China (494 billion barrels), Iran (426 billion barrels) and Canada (221 billion barrels.)

"Our overwhelming coal, natural gas, and oil resources represent tens of trillions of dollars in wealth and millions of American jobs,” said Sen. James Inhofe (R.-Ok.), who, along with Sen. Lisa Murkowski (R.-Alaska), released the report last week. “Whether through decree or purposeful inaction, government policies that unnecessarily restrict or prevent our ability to responsibly produce these domestic resources are threatening, and could eventually undermine, our nation's economic and national security. We should pursue an all-of-the-above strategy that advances new energy technologies but also prioritizes developing the resources we have today." 

The report also noted that the United States has 28% of all the world’s coal reserves, with Russia again coming in second with 19%.

In addition, the report stated that the United States has tapped into only 13% or 21 billion barrels of its oil reserves, with the other 87% still untouched.

The following charts show the true picture of America’s energy reserves:







http://www.humanevents.com/article.php?id=34233

[DougMacG]

BBG: "Wouldn't it be amusing if our current, misguided energy policy left us on top of huge reserves we could charge high prices for down the line?"

Very possible.  Ironic is the fact that the forbidden cheap energy around us is one of the forces preventing the move to the next solution (that will save the planet).  Artificial regulations force prices up but people can still see the low hanging fruit.  Why would people freely pay 15X for solar when clean coal is abundant, for example.

When the easy to access oil gets used up and the easy to access natural gas starts getting depleted, then market innovations of necessity will happen - if you believe in all that freedom and capitalism nonsense that made us the wealthiest civilization in history.

[Freki]

I sent BBG's article to my Geoligist friend and here is his responce.


This is a little misleading.

The U.S. rules in coal, we have more coal than anyone, we are the middle east of coal. That is the bulk of “largest energy reserves on earth”.

When they say tapped into 13% of oil reserves, in actuality we have tapped into 99.9% of oil reserves and managed to extract 13%. The majority stays in the reservoirs and is really hard to get out. We have to develop more expensive secondary recovery methods to get it, and no one wants to spend the money to do it, when we can chug along at 13% (typically 20-30% extraction is really good).

Until prices for barrels get higher and higher, there isn’t an incentive to improve extraction methods, it’ll happen eventually though.

[DougMacG]

(According to a radio spoof) we really need to focus our government programs for renewable energy on areas with the best potential for large scale returns: sun, wind, perpetual motion and personal methane reclamation systems. 

[Body-by-Guinness]

November 11, 2009
A Lesson in Biofuels from Tennessee

By Jeffrey Folks
In 2007, to great fanfare and amid ever-greater expectations, a large-scale demonstration project was initiated to turn switchgrass into biofuel. For an investment of $70 million, the taxpayers of the state of Tennessee were promised a lucrative new industry that would benefit farmers and create thousands of other "green jobs." The project, which was expected to produce five million gallons of biofuel from switchgrass within two years, would soon be fiscally self-sustaining and afford a "significant return" on investment. As the largest switchgrass demonstration project in the country, it was to have been the foundation for a whole new industry.

Sounds great, and it is just what the Tennessee legislature approved in 2007. When it began, "the University of Tennessee Biofuels Initiative," as it is called, excited favorable comments in newspapers and media across the country. Finally, there would be a practical alternative to those nasty fossil fuels, and the great thing was that it would be produced from a hearty plant that could be grown on marginal land almost anywhere. Switchgrass was the answer to America's dependence on foreign oil. It would restore the trade balance, boost the economy, and save the earth, all at the same time.

Now, according to the Knoxville News Sentinel, the Biofuels Initiative has reported that it is not yet producing 5 million gallons of switchgrass fuel. In fact, according to published reports, it would seem that it is not producing any fuel at all. The 250,000 gallons of ethanol that it is producing have been distilled from corn cobs -- a process akin to one already quite common, if not notorious, in the state of Tennessee.

According to figures from the U.S. Department of Energy, a biofuels facility of the sort envisioned would not be feasible unless it produced five million gallons per year. But according to a report by the executive director of the Fiscal Review Committee of the Tennessee state legislature, it appears certain that the Biofuels Initiative will not be "self-sufficient," as promised, within five years. Having initially promised that the plant would produce five million gallons with the goal of demonstrating the feasibility of switchgrass, the project director now seems to regard the initiative as a "research project." The feasibility issue will have to wait until some time in the future.

The project has cost the state $55 million, not counting additional federal funding and state subsidies to farmers growing switchgrass. Now members of the legislature are quoted as saying that the project is "not good stewardship of taxpayer dollars" and that continued funding "may need re-evaluation." The director of the project insists that the State Building Commission approved changes, but it appears that the legislature at large was not aware of them. Whether the legislature will continue funding the Biofuels Initiative, and at what level, will be determined after November 15.

Altogether, more than $90 million has been spent on the University of Tennessee Biofuels Initiative with no end in sight. On the national scale, tens of billions of dollars are being spent on similar alternative energy subsidies and research with little to show for it.

Much of this funding goes directly to foreign manufacturers. As reported in the Wall Street Journal, "China has positioned itself to reap many of the benefits" by exporting wind-turbines, solar panels, and other alternative energy products. The CEO of A-Power Energy Generation Systems, one of China's largest wind-turbine companies, has stated that the U.S. "is an ideal target" for exporting Chinese-made alternative energy goods.

Meanwhile, the Obama administration seems determined to kill off as many jobs as possible in well-established energy businesses here in the United States. The administration has placed a moratorium on mountaintop coal mining, affecting jobs throughout Appalachia. Interior Secretary Ken Salazar has delayed shale exploration in the western United States and reneged on promises to permit offshore drilling in Alaska and along the Atlantic and Pacific coasts.

At a time when Chinese and other foreign oil companies are buying up leases in the Gulf of Mexico, Obama is making it harder for our own energy companies to explore through the threat of cap-and-trade legislation. Domestic drilling for natural gas now stands at half of what it was just last year. The world's big new discoveries of oil and gas are taking place outside the U.S., offshore in Brazil and West Africa. Foreign countries will reap the economic reward of this exploration and production. Meanwhile, the value of U.S. currency continues to decline, and unemployment has risen to 10.2%.

How many energy-sector jobs has this administration killed off? Estimates are that new oil and gas discoveries in Brazil will create 400,000 new jobs (real jobs, not the "created or saved" variety). Even in the midst of a global recession, the Brazilian economy has shown resilience, perhaps because they are not busy eradicating jobs in their own energy sector. America could have a booming economy once again, with full employment and expanding wealth, but everything the President has done is designed to cripple our own industries and drive jobs overseas.

On one score, however, we can give the president credit. He has taken the initiative in driving CO2 emissions down, a step that some scientists believe will reduce global warming. The problem is that the earth is not warming: according the U. N.'s Intergovernmental Panel on Climate Change, the global temperature is now cooling, and it has been cooling for nearly a decade.

Obama has already budgeted tens of billions to combat climate change, a figure dwarfed by the amount proposed under cap-and-trade. The problem is, why cripple the economy to combat temperatures that are not rising? Obama seems to be in the same camp as the director of the Biofuels Initiative, who believes that switchgrass research will pay off some time in the future. Although it cannot be demonstrated now, at some time in the future the earth's temperatures are going to rise, and then we'll be glad we killed off America's fossil fuel industries. By that time, a lot of Americans will be without jobs, and whatever jobs they have won't be worth much.

But just think how happy the earth will be. Somewhere in the remote Arctic wilderness, a migratory caribou, grazing above five billion barrels of domestic oil reserves, will pause and thank us. After a few weeks it will pack up and head south for the long arctic winter, where it will reside comfortably while the unfortunate humans huddled in America will struggle to buy food, heat their homes, and make a living wage.

At that point, that $90 million spent on switchgrass research, and all of the other funds squandered on alternative energy research, would certainly come in handy, but it will be too late. China will be sitting pretty atop the world's largest fossil fuel reserves. Americans will be sitting around hoping the wind keeps blowing.

Dr. Jeffrey Folks taught for thirty years in universities in Europe, America, and Japan.

Page Printed from: http://www.americanthinker.com/2009/11/a_lesson_in_biofuels_from_tenn.html at November 11, 2009 - 11:31:19 AM EST

[Crafty_Dog]

Who Needs the Grid?
A new fuel-cell technology promises to revolutionize access to cheap, clean energy.
by Lane Wallace




IN THE BOARDROOM at Bloom Energy, a single picture hangs on the wall: a satellite image of the world at night. Clusters of bright lights mark the industrial centers, and thin white lines trace connecting passageways such as the U.S. Interstate System and the Trans-Siberian Railroad. In between, huge swaths lie in shadow.

Standing almost reverently before the image, K. R. Sridhar, the CEO of Bloom, points to the dark areas—places where electricity isn’t accessible or reliable. “This is my motivation for everything,” he says. To improve the lot of the more than 2 billion people living in those dark areas, he says, you have to get them reliable, affordable energy. And if you don’t want to doom the environment in the process, you have to make that energy very clean.

Impossible? No more so than creating enough water and oxygen to keep astronauts alive on Mars. And Sridhar’s already figured out how to do that. In fact, his research on oxygen generators for NASA laid the technical groundwork for his current venture: highly efficient solid-oxide fuel cells that run on everything from plant waste to natural gas and provide electricity while emitting relatively little carbon dioxide.

Such technology might sound far-fetched, but the basic patent behind Sridhar’s cells, which he calls “Bloom boxes,” dates to 1899. Fuel cells—which facilitate a chemical reaction between oxygen and hydrogen or hydrocarbon fuel without burning anything—have been used aboardNASA vehicles and Navy submarines for years. The biggest challenge in adapting them for commercial use was making the technology reliable and affordable. That’s where Sridhar’sNASA background gave him a breakthrough advantage.

“To send anything to Mars is so expensive, you have to extract the most use possible out of it. Which means you have to change your underlying assumptions about everything,” he explains. “So with [the Bloom boxes], I did the same thing. I looked at each component and, for example, set a price point that it absolutely had to make.”

Nearly eight years and a reported $250 million in venture-capital investment later, Sridhar has a working product that’s been in field trials for the past two years and is about to go on the global market, at a price he says will be competitive with existing energy options. As for results: in an ongoing trial at the University of Tennessee, a five-kilowatt Bloom box (the size of a large coffee table and capable of powering a 5,000-square-foot house) has proved twice as efficient as a traditional gas-burning system and produced 60 percent fewer emissions.

Since the boxes are “fuel agnostic,” customers can run them on existing propane, natural gas, or ethanol sources. But they’ll also run on plant waste, or almost anything else containing hydrogen and carbon. And the eventual “killer app”? Processing wind- or solar-generated electricity with water to create storable oxygen and hydrogen, then reversing the process to generate electricity at night or in low-wind or cloudy conditions.

That alone gives the technology impressive potential.

“If you have clean, affordable energy, you can get clean air and clean water whenever you want,” Sridhar says. “You can make recycling affordable. You can turn latent local resources into marketable ones.”

But the truly disruptive aspect of Bloom’s fuel cells isn’t their clean, quiet, affordable efficiency. It’s their ability to operate independent of a power grid. That’s critical for developing countries, which lack infrastructure. It could also allow Bloom to revolutionize energy-generation in industrialized nations.

“I want to open up access to energy the way that PCs and the Web opened up access to information,” Sridhar says. “So people can live where they want, and still be connected, without someone telling them when they can do their laundry.” A distributed energy system would also be far less susceptible to attack or natural disaster.

Should the utility companies be worried? Possibly. As Sridhar points out, “The companies who saw their business as selling mainframe computers are gone.” Of course, the utilities could also do as IBM did, and adapt. “The human ability to innovate out of a jam is profound,” Sridhar says with a smile. “That’s why Darwin will always be right, and Malthus will always be wrong.”

[ccp]

From the other George W.
 
****By George Will

 http://www.JewishWorldReview.com | What city contributed most to the making of the modern world? The Paris of the Enlightenment and then of Napoleon, pioneer of mass armies and nationalist statism? London, seat of parliamentary democracy and center of finance? Or perhaps Titusville, Pa.

Oil seeping from the ground there was collected for medicinal purposes — until Edwin Drake drilled and 150 years ago (Aug. 27, 1859) found the basis of our world, 69 feet below the surface of Pennsylvania, which oil historian Daniel Yergin calls "the Saudi Arabia of 19th-century oil."

For many years, most oil was used for lighting and lubrication, and the amounts extracted were modest. Then in 1901, a new well named for an East Texas hillock, Spindletop, began gushing more per day than all other U.S. wells combined.

Since then, America has exhausted its hydrocarbon supplies. Repeatedly.

In 1914, the Bureau of Mines said that U.S. oil reserves would be exhausted by 1924. In 1939, the Interior Department said that the world had 13 years' worth of petroleum reserves. Then a global war was fought, and the postwar boom was fueled. In 1951 Interior reported that the world had . . . 13 years of reserves. In 1970, the world's proven oil reserves were an estimated 612 billion barrels. By 2006, more than 767 billion barrels had been pumped, and proven reserves were 1.2 trillion barrels. In 1977, scold in chief Jimmy Carter predicted that mankind "could use up all the proven reserves of oil in the entire world by the end of the next decade." Since then the world has consumed three times more oil than was then in the world's proven reserves.


 FREE SUBSCRIPTION TO INFLUENTIAL NEWSLETTER

  Every weekday NewsAndOpinion.com publishes what many in the media and Washington consider "must-reading". HUNDREDS of columnists and cartoonists regularly appear. Sign up for the daily update. It's free. Just click here.
 
 

But surely now America can quickly wean itself from hydrocarbons, adopting alternative energies — wind, solar, nuclear? No.

Keith O. Rattie, chief executive of Questar, a natural gas and pipeline company, says that by 2050 there may be 10 billion people demanding energy — a daunting prospect, considering that of today's 6.2 billion people, nearly 2 billion "don't even have electricity — never flipped a light switch." Rattie says that energy demand will grow 30 to 50 percent in the next 20 years and there are no near-term alternatives to fossil fuels.

Today, wind and solar power combined are just one-sixth of 1 percent of American energy consumption. Nuclear? The United States and other rich nations endorse reducing world carbon emissions 80 percent by 2050. But Oliver Morton, a science writer, says that if nuclear is to supply even 10 percent of the necessary carbon-free energy, the world must build more than 50 large nuclear power plants a year. Currently five a year are being built. Rattie says that as part of "a worldwide building boom in coal-fired power plants," about 30 under construction in America "will burn about 70 million tons of coal a year."

Edward L. Morse, an energy official in Carter's State Department, writes in Foreign Affairs that the world's deep-water oil and gas reserves are significantly larger than was thought a decade ago, and high prices have spurred development of technologies — a drilling vessel can cost $1 billion — for extracting them. The costs of developing oil sands — Canada may contain more oil than Saudi Arabia — are declining, so projects that last year were not economic with the price of oil under $90 a barrel are now viable with oil at $79 a barrel.

Morse says new technologies are also speeding development of natural gas trapped in U.S. shale rock. The Marcellus Shale, which stretches from West Virginia through Pennsylvania and into New York, "may contain as much natural gas as the North Field in Qatar, the largest field ever discovered."

Rattie says that known U.S. reserves of natural gas, which are sure to become larger, exceed 100 years of supply at the current rate of consumption. BP recently announced a "giant" oil discovery beneath the Gulf of Mexico. Yergin, writing in Foreign Policy, says "careful examination of the world's resource base . . . indicates that the resource endowment of the planet is sufficient to keep up with demand for decades to come."

Such good news horrifies people who relish scarcity because it requires — or so they say — government to ration what is scarce and to generally boss people to mend their behavior: "This is the police!" Put down that incandescent bulb and step away from the lamp!"

Today, there is a name for the political doctrine that rejoices in scarcity of everything except government. The name is environmentalism.*****

[Body-by-Guinness]

How Offshore Oil and Gas Production Benefits the Economy and the Environment
by Bruce Allen
Backgrounder #2341
Abstract: Conventional wisdom holds that offshore oil and gas production harms the surrounding environment. This blanket "wisdom" ignores the fact that the largest source of marine hydrocarbon pollution is offshore natural oil seepage. It also ignores the fact that offshore oil production has lowered the amount of oil released into the ocean by reducing natural oil seepage, especially in areas with active offshore oil seeps, such as California's Santa Barbara coast. This Heritage Foundation analysis cites studies, developments, and biological facts that demonstrate often-overlooked benefits of offshore oil and gas production.

The oceans surrounding the United States hold tremendous oil and natural gas potential, but much of that potential is not being realized. Nearly 85 percent of these waters -- the Atlantic, the Pacific, and the eastern Gulf of Mexico -- are off-limits to exploration and drilling. Government studies estimate that these restricted areas hold at least 19 billion barrels of oil -- nearly 30 years' worth of current imports from Saudi Arabia -- and oil estimates are known to increase as exploration occurs. The greatest untapped potential lies in the Pacific. Producing this oil would increase oil supplies, lower prices, and generate large tax revenues -- while creating thousands of jobs in the domestic energy industry.

Drilling restrictions in general are imposed due to environmental concerns, despite the fact that offshore environmental damage has been greatly reduced by technologies that minimize the risk of oil spills and other hazards to the environment. In fact, offshore oil production has lowered the amount of oil released into the ocean by reducing natural seepage of oil, especially in areas with active offshore oil seeps, such as California's Santa Barbara coast.

Natural hydrocarbon seeps have historically been used to locate the world's usable sources of oil and tar. Papers published by British Petroleum in the early 1990s[1] show that over 75 percent of the world's oil basins contain surface oil seeps. Most seeps emit small volumes of oil and gas that do not significantly deplete hydrocarbon reservoirs over the short term, but can add up to significant depletion of oil and gas over the longer term.

The knowledge that surface seepage has a direct link to subsurface oil and gas accumulations is not new and has been the impetus for many of the world's early major oil and gas discoveries by pioneers of oil production -- as far back as ancient China, and more recently the 1860s in Pennsylvania and the 1890s in Azerbaijan. Natural seeps were the impetus for early exploration of oil in Iran and Iraq in the early 1900s.

Natural hydrocarbon seeps continue to be an important indicator of economic oil and gas resources. The high cost of deep-water offshore oil and gas exploration has made the identification of hydrocarbon seeps an important consideration in oil-exploration risk-reduction methods.[2]

Natural Seeps: The Largest Source of U.S. Marine Hydrocarbon Pollution

Natural hydrocarbon seeps generally result from pressurized hydrocarbon reservoirs that force oil and gas up through fissures to the earth's surface either on land or the seabed floor where the hydrocarbons escape in the form of oil, tar, and methane-rich gases.

It is a widely overlooked fact that natural hydrocarbon seeps generally have a larger impact on the marine environment than do oil and gas exploration and production. According to the National Academy of Sciences, 63 percent of hydrocarbon pollution in U.S. waters stems from natural seeps, while only 1 percent is due to offshore drilling and extraction.[3] Geologists believe that over the course of millions of years, more oil has seeped naturally into the earth's environment than currently exists in all conventional oil reservoirs combined.

The Gulf of Mexico, for instance, is a major U.S. offshore oil and gas producing region where the environmental impact of natural hydrocarbon seepage appears to far exceed the environmental impact of accidental oil releases due to commercial extraction and transportation.[4]

Onshore hydrocarbon seeps are also pervasive in many areas of the world, and are a source of contamination for many streambeds and rivers. The Santa Susanna Mountains in California are estimated to contain 22,000 active oil seeps that are associated with significant streambed contamination.[5]

One of the most studied offshore oil and gas seep regions over the last 40 years is the Santa Barbara coast of California, which has the world's second most prolific oil seepage areas, extending for about 80 miles along the coastline.[6] The offshore Santa Barbara oil seepage zones result in about 70,000 barrels per year of oil and tar seepage into the Pacific, much of which washes up on California beaches.[7] Every four years, the amount of offshore Santa Barbara oil seepage exceeds the 240,000 barrels that spilled from the Exxon Valdez in 1989. By comparison, according to the U.S. Minerals and Management Service, the total amount of oil spilled in California coastal waters due to offshore oil production since 1970 has been less than 870 barrels.[8] Far more birds and wildlife have been killed in the last 40 years by California's offshore oil seepage than by all previous California offshore oil production spills combined, including the 1969 spill.[9]

Seeps are also one of the world's largest methane gas emission sources,[10] and are a major source of air pollution in Santa Barbara County.[11] These coastal California seeps release oil and tar that washes ashore along nearly half the coastline of California, with the highest concentrations in Santa Barbara County. In the winter, the Davidson current washes seep oil and tar ashore as far north as the beaches of Santa Cruz and San Francisco.[12]

The California Department of Fish Game often receives public calls reporting a possible oil spill on California central coast beaches, which is invariably determined to be natural seepage. The California Department of Fish Game requires that seep oil and tar collected on California beaches be treated as hazardous waste, the same as for industrial oil spills.

Offshore Production: Significant Reductions in Oil Pollution on California Beaches

One of the side affects of offshore oil production has been the reduction of oil and gas seepage due to decreases in subsea oil-reservoir pressure. Seep oil is chemically the same as commercially extracted oil, although the seep oil and tar have often undergone partial oxidation by the time they move into the water or onshore.

The seepage reductions due to offshore oil and gas extraction have, in some cases, resulted in significant reductions in natural oil and gas seep pollution over the last 40 years.[13]

There are also anecdotal observations and research indicating that oil production around the world is responsible for ongoing reductions in hydrocarbon seepage pollution.[14]

Ironically, the decreased oil and gas reservoir pressure due to ongoing "legacy" offshore oil and gas production (which continued even after the state-wide offshore moratorium was imposed) near the site of the famous 1969 Santa Barbara oil spill is resulting in reductions in California's coastal seepage pollution. California beaches have become significantly cleaner over the last 50 years due to offshore oil and gas production.

Modern slant and horizontal drilling is extending these benefits into seep zones located further into the ocean than the areas immediately surrounding existing offshore production platforms. Central and southern California beaches have been polluted by this natural seep oil for well over 100,000 years. A 22-year study of the offshore oil platform "Holly" off the Californian coast concluded that,"Oil production here has resulted in an unexpected benefit to the atmosphere and marine environment."[15]According to peer-reviewed University of California research, if offshore production were expanded in the seep zone areas studied, there would be further reductions in seepage pollution and the associated methane gas and ozone-forming reactive organic compounds (ROCs).[16]

Long-time Santa Barbara residents have also observed for the last 50 years that their beaches have seen significant reductions in seepage oil and tar beach pollution. The simple fact is that California offshore oil and gas production has been the reason why California's prolific natural oil and gas seepage pollution has been declining for decades. California beaches are becoming cleaner thanks to existing legacy offshore oil and gas production. Geologists believe these reductions in seepage pollution will last for thousands of years.

Offshore hydrocarbon seeps are also a naturally dynamic process. In addition to reduced seepage due to reservoir pressure reductions from commercial extraction, seeps can also become active in new areas due to earthquakes and other natural events. In 2007, an earthquake in New Zealand resulted in a new offshore seepage area that led to exploration activity to determine the underlying reservoir's production potential. This seep zone off the New Zealand coast had previously not been explored for the presence of economically recoverable hydrocarbons.[17]

In Santa Barbara, a 6.8 magnitude earthquake in 1925 resulted in a large spontaneous release of undersea reservoir oil off the coast that boiled up from the seafloor and inundated the coastline and beaches with extensive oil slicks.[18] The southern California 1971 Sylmar earthquake also resulted in new offshore seep areas observed in previously unrecorded areas.

In January 2005, an increase in natural seepage off the California coast resulted in oil slicks that covered more than 20 square miles. The increased seepage subsided over the following weeks.

Since Californian offshore production began in the late 1950s, far more wildlife has been killed (using bird death estimates as a surrogate) by California's offshore natural oil seeps than by all of California offshore oil production spills combined. It is an interesting artifact of the offshore oil debate that large numbers of bird deaths due to natural oil seepage garners no media attention, whereas small numbers of bird deaths due to a small oil spill causes extensive national attention and outrage by opponents of offshore oil production -- even in areas where offshore production has been consistently reducing pollution caused by natural seepage.

A new study estimates that oil seepage off the Santa Barbara coast from one seep area alone (Coal Oil Point) has resulted in current oil sediment deposits between 8 and 80 times the amount of oil released from the Exxon Valdez spill.[19]

There are also concerns about air pollution resulting from seepage. Gas emissions from hydrocarbon seeps are estimated to be one of the largest sources of methane released annually into the earth's atmosphere, and studies indicate that existing oil and gas production may be causing ongoing reductions in methane emissions worldwide.[20] Methane is a potent greenhouse gas. Natural offshore seep emissions are one of the largest sources of air pollution in Santa Barbara County.

Oil Seeps: Indicators of Oil and Gas Reserves

The presence of natural oil seeps has led to the discovery of some of the world's largest oil fields. The second-largest oil field ever discovered, the Cantarell "supergiant" field, was discovered after a fisherman, Rudesindo Cantarell, repeatedly complained to the Mexican national oil company PEMEX that his fishing nets were being covered with oil in the Gulf of Mexico. PEMEX had no oil operations in Mr. Cantarell's fishing area. The company investigated the source of the offshore oil and subsequently discovered an offshore oil field in 1976 which had produced more than 12 billion barrels of oil by 2007. Although being depleted rapidly, the Cantarell field is still one of Mexico's largest single sources of oil production.[21]

At current rates of oil seepage off the Santa Barbara coast, about 7 billion barrels of oil may already have seeped into the California coastal marine environment over the last 100,000 years. The lifespan of the Santa Barbara offshore oil seeps is estimated to exceed 400,000 years. Seven billion barrels of oil represents approximately 25 percent of all current U.S. oil reserves. Seven billion barrels of new Santa Barbara offshore oil production would supply all of California's current imported oil needs for the next 25 years.

National Offshore Energy Policy Should Consider Natural Oil and Gas Seepage

Natural oil and gas seeps are by far the largest sources of hydrocarbon pollution released into U.S. coastal waters and are a major source of offshore oil pollution and atmospheric methane emissions worldwide. Oil and gas seeps are also one of the most important indicators for locating recoverable hydrocarbon resources. California's central and south coast has seen significant environmental benefits from the reductions in coastal seepage pollution due to offshore oil and gas production. California's coastal environment would benefit from offshore oil and gas expansion in active seep areas that are currently off-limits in California waters, as well as in federal seep zone waters in the Santa Maria basin in the Outer Continental Shelf. Thus offshore oil and gas production represents both an effective means of addressing the problems of seepage pollution as well as an economic opportunity.

Continued research may also show that the long-term environmental benefits that coastal California has experienced due to offshore oil and gas extraction may be occurring in other regions as well -- albeit probably to a lesser degree.

The economic benefits from increased domestic hydrocarbon production are well known, but many erroneously assume they come at an environmental cost. In truth, there are opportunities, off Santa Barbara and elsewhere, to achieve substantial environmental benefits from drilling as a consequence of reduced seepage of oil and natural gas into the air and water. Expanded offshore oil and gas production can genuinely be a win-win proposition.

Bruce Allen is co-founder of SOS California, an environmental and energy non-profit based in Santa Barbara, California.


[1] R. H. Clarke and R.W. Cleverly, "Petroleum Seepage and Post-Accumulation Migration," Geological Society, London, Special Publications, Vol. 59 (1991), pp. 265-271.

[2]Donald F. Saunders and Martin J. Davidson, eds., Surface Geochemical Exploration for Petroleum, Collected Papers, Library Collection (1933-2006), DeGolyer Library, Southern Methodist University.

[3]National Academy of Sciences, "Oil in the Sea III," The National Academies, 2002, at http://books.nap.edu/html/oil_in_the_sea/reportbrief.pdf (October 15, 2009).

[4]Roger Sassen, Alexei. V. Milkov, and Harry H. Roberts, "Environmental Significance of Gas and Oil Seeps, Gulf of Mexico, Continental Slope," American Association of Petroleum Geologists, Conference Report, 2002.

[5]"Investigation and Risk Assessment of Significant Natural Seeps in Santa Paula Creek" (SSEP 2008-09), California Department of Fish and Game, 2008.

[6]"Decrease in Natural Marine Hydrocarbon Seepage Near Coal Oil Point, California, Associated with Offshore Oil Production," Geology, November 1999.

[7]Santa Barbara County, "Natural Oil Seeps and Oil Spills," March 8, 2002, at http://www.countyofsb.org/energy/information/seepspaper.asp#_ednref33 (October 15, 2009), and Santa Barbara County, "Natural Seep Project Summary," Planning and Development Department, Energy Division and U.S. Geological Survey, Western Coastal and Marine Geology Team, Menlo Park, CA, May 24, 2004, at http://www.countyofsb.org/energy/information/
naturalSeepProjectSummary.asp (October 15, 2009).

[8]U.S. Minerals Management Service, Pacific OCS Region, at http://www.mms.gov/omm/Pacific/offshore/oil-and-gasfaq.htm (November 10, 2009).

[9]Santa Barbara Wildlife Care Network, at http://www.sbwcn.org/edu/oiled.php (November 16, 2009).

[10]Martin Hovland, Alan G. Judd, and R. A. Burke, "The Global Flux of Methane from Shallow Submarine Sediments," Chemosphere, Vol. 26 (1993), pp. 559-578.

[11]"Factor Analysis of Hydrocarbon Species in the South-Central Coast Air Basin," Journal of Applied Meteorology, Vol. 30 (May 1991), pp. 733-743.

[12]"Families of Miocene Monterey Crude Oil, Seep, and Tarball Samples, Coastal California," American Association of Petroleum Geologists Bulletin Vol. 92, No. 9 (September 2008), pp. 1131-1152.

[13]"Decrease in Natural Marine Hydrocarbon Seepage Near Coal Oil Point, California," Geology,November 1999.

[14]"The World's Most Spectacular Marine Hydrocarbon Seeps," Journal of Geophysical Research, Vol. 104 (September 15, 1999), pp. 20, 703-720.

[15]"Decrease in Natural Marine Hydrocarbon Seepage near Coal Oil Point, California, Associated with Offshore Oil Production," Geology,November 1999.

[16]"The World's Most Spectacular Marine Hydrocarbon Seeps," Journal of Geophysical Research.

[17]Press release, "Tests Identify Oil In Great South Basin," New Zealand Ministry of Economic Development, March 12, 2007.

[18]"June 29, 1925 Santa Barbara 6.8 Magnitude Earthquake," Santa Barbara Daily News, July 4, 1925.

[19]Press release, "UCSB Scientists Document Fate of Huge Oil Slicks from Seeps at Coal Oil Point," University of California, Santa Barbara, May 13, 2009, at http://www.instadv.ucsb.edu/pa/display.aspx?pkey=2010 (October 16, 2009).

[20]"Decrease in Natural Marine Hydrocarbon Seepage Near Coal Oil Point, California, Associated with Offshore Oil Production," Geology,November 1999.

[21]L. Cruz and J. Sheridan, "Relative Contribution to Fluid Flow From Natural Fractures in the Cantarell Field, Mexico," Society of Petroleum Engineers, 2009.

http://www.heritage.org/Research/EnergyandEnvironment/bg2341.cfm

[ccp]

Doug suggested we come up with a new contract with America.  One of the promises I thought of is that Republicans promise to make America self sufficient when it comes to our energy needs.  I did a search for this but all I pull up is lefitst rants about alternative energy like solar, wind etc, and/or biofuels.
I went to Newt's webite and he has a column for energy but he points out near the bottom is "we have to come up with an alternative to what the Democrats are offering now".

I don't see why we can't do all of it as well as using our own offshore reserves, nuclear, Canada shale etc. instead of shooting ourselves in the head like BO and the rest of the socialists (and the rest of the laughing world) want us to do.

In any case we need a showdown on energy policy to help knock the liberals out of power.
Probably most Americans would buy it if we can surmount the MSM propaganda machine.

[DougMacG]

Thanks CCP, I like the way you are thinking.  To me, it is not total energy independence that we need, but at the least we should be able to survive with what can be produced in partnership with a friendly Canada and stop enriching enemies and shipping crucial supplies through faraway, difficult to defend waters.

I was planning to post a plan from Victor Hanson in 'the way forward' and I still will, but here is his energy component:

VDH: "A can-do energy plan. Offer tax incentives for development of nuclear power. Promote exploitation of gas and oil reserves in, and off, the United States, as a way to transition over 20 years to next generation fuels without enriching our enemies or going broke in the process. I never understood why nuclear power for electricity and natural gas/hybrids for transportation—we could be nearly energy independent through both—were declared environmentally incorrect when dotting pristine fields, deserts, and mountain passes with ugly wind turbines, acres of solar panels, and miles of access roads was considered “green.” Does Obama really think that the truther Van Jones knows more about power production than the head of a natural gas or oil company, or the engineer of a nuclear power plant?"
----

The answer of course is all of the above.  We can keep expanding wind and solar and developing 'next generation fuels' but still need to power the economy in the meantime. 

Hanson writes:  "nuclear power for electricity and natural gas/hybrids for transportation".

I wrote similarly in the nuclear thread (8/11/09): "If we substitute nuclear for natural gas in electricity and American natural gas in place of foreign oil in transportation, besides solving the CO2 spiral we would also be sending fewer dollars sent to Chavez and the Mullahs.  It would be good for the currency, simplify foreign policy and ease the cost of national defense."

Instead we dither.