Are We Headed for a Green World or Business-as-Usual? 28 comments
an article to
-
Font Size:
-
Print
- TweetThis
Many people are wondering whether the future will be "green" or business-as-usual". The answer in our view is "No." It will be neither. It will be both.
Opinions about he future tend to fall into one of two camps. The "Green" camp advocates "cap-and-trade," wind power, solar power, electric vehicles, a simpler lifestyle with less transport, and backyard gardens. The business-as-usual crowd thinks that global warming is a hoax, plenty of oil, gas, and coal exists and can be economically recovered with only modestly higher prices or even with lower prices, technology can solve resource constraints, nuclear power is always available if fossil fuels get scarce, and the needs of the economy take precedence over environmental considerations.
In the news are two stories about what is actually happening; these should give members of either "camp" reason to pause and think a bit harder.
China is investing US$1.7 billion in two Alberta oil sands projects.
The Financial Times reports that the investment needs oil at US$50 to $60 per barrel to be successful. The Chinese investment was made after ten years of watching and waiting for the price to be right. The Canadian oil sands are notorious among environmentalists as major sources of carbon emissions, downstream pollution for rivers, and marginal "energy return on energy invested".
Another bit of news from China: BYD, the Chinese electric car producer, 10% of which is owned by Warren Buffett, has moved up by one year its plans to introduce an all-electric vehicle into the US market, in 2010.
So whose side are the Chinese on? Or is this a case of two opposing factions making these investments?
Again, the answer is neither. As oil becomes more costly to find, its price will rise. This will make cars running on gasoline more expensive to operate, and electric vehicles will be increasingly competitive. It is impossible to convert the world's fleet of vehicles from gasoline to electric in less than a generation, and so gasoline will continue to be needed for many years. And as the price of oil rises, more sources will become economic, such as the Canadian oil sands and the deepwater resources off the coast of Brazil. Electricity will become more expensive too, in part because the world will recognize the need to place a price on carbon emissions, and the share of electricity generated from economically-viable renewables will grow.
Yet another insight into the need for the two "camps" to break out of their ideological strait jackets comes from a book published earlier this year written by veteran journalist William Tucker titled "Terrestrial Energy." He takes climate change and "peak oil" concerns seriously, which means conservatives won't listen to him. He also makes a compelling case that nuclear energy (based on uranium and thorium from the earth--hence terrestrial) is the alternative to fossil fuels with the greatest potential to solve both the problems of environment and energy. That means the "green" camp won't listen to him.
In our view, both "camps" should be listening to him, and to each other.
Disclosure: None.
Related Articles
|
-
The Seeking Alpha 100
See allThe top 100 stock
market authors
selected for publication
Seeking Alpha 100 » -
Fastest Climbers
Authors with the largestSee all
increase in followers
in the last 7 days
Fastest Climbers » -
Top Commenters
Top commenters,See all
as ranked by their peers
Top Commenters » -
Top Instabloggers
The 100 most active
Instabloggers.-
1
David Fry
-
2
TraderMark
-
3
Don Dion
-
4
Cliff Wachtel
-
5
Mike Havrilla
Top Instabloggers » -
1
-
Top StockTalkers
TopSee all
StockTalkers.
Top StockTalkers »
Costs will drive the future, not anything else.
But until oil, coal is stopped from being subsidized by having their costs socialized then it will be hard for RE to get started taking it's rightful place as the future low cost energy source.
If the costs of oil from tax breaks, depletion allowances, oil wars, Persian Gulf military, balance of payments, is in oil, the RE, EV's are easily the ;low cost energy source with a tax cut, help converting to more eff transportation from the revenue.
. In coal if the land, water supply, air destruction was in it instead of on the taxpapers tab, health care costs then again RE is the low cost energy source. Once they are in them, only then can a true free market work it's magic.
Neither of these considers CO2 costs. This is a national, economic security issue. CO2 reduction is just a bonus.
But RE does not make big profits for most investors as it's inherently a small business, scale energy source. This why big energy fights it tooth and nail as they can't control, profit from it much.
For instance wind generators in home sizes can be bought now for under $2k/kw with inverter. And these costs will drop more once in real mass production. A good 2kw WG will produce between 8 and 20kwhrs/day for 50 yrs with minor maintaining every yr. This can supply electricity to most homes and another KW worth charge EV's.
Next example is a solar CSP which is just a 5hp steam/Rankine engine, a 200sq' trough collector, 3kw alternator that puts out 9-20 kwhrs/day with 27-60kwhrs of heat also. Low solar areas can just add collector area cheaply and can store heat for power when the sun doesn't shine. And can be fired by any bio or other fuel for power, heat. This in mass production would cost under $3k/kw.
Now I want to see any fossil fuel, nuke beat these simple, inexpensive, long lasting energy sources.. They all cost less to build than Coal at $4k/kw, Nuke at $9-18k/kw, oil not viable because of fuel costs which coal, nuke has too, above the plant costs makes these way too expensive in the future. Only NG can compete. Possibly lower cost nuke could work if it is done very differently but no sign of that happening yet.
River/tidal power which the US has enough resources to replace coal completely without dams and very little eco impact costs under $2k/kw. I've done this myself back in the 80's.
Few are mentioning our most plentiful energy source, conservation, eff which can cut our energy needs by 50%. Things like insulation, better windows, EV's, smaller cars, etc are the future. EV's go 3-6x's as far on the same base energy as a gas car does made far worse by the price of oil going up next yr for gas/diesel cars.
Those that don't go this way will pay the price. All we need to do is put a tax on oil, coal to pay their real, full costs and the rest will happen naturally. And by being independent of imported oil will save $T/yr in imported oil in 2 yrs and by cutting the oil demand here, make Iran, Russia, oil dictators and terrorist pay most of the tax by lower oil prices.
I agree, that would be a good idea!
And, the chances of that happening, are pretty much ZERO!
But just for the record, oil output peaked in the U.S. in l970 at 9.5 mb/d, and today it is 5.5 mb/d and going down. Exploration peaked in l965 and 1981-2 was the last time that reserve increases were larger than consumption. The UK North Sea peaked just before 2000 and the Norwegian North Sea is peaking now. Output in Russia hasn't peaked but is about 9.8 mb/d, however according to a Russian oil boss, their production will never exceed 10 mb/d. He's wrong of course, but not by much. The boss of one of my students in Thailand told him that peak oil was nonsense, which means that he did not know what was happening in his own oil company....
Somebody should wake up.
No amount of research will change the laws of physics !
does the hare win or the tortoise?
> jack
It will be too late to develop alternatives.
However, take gold. Some may have learned that taking it from the ground was good. Selling it was even better. And then, maybe realized it was going to be gone forever (in someone else's pocket), so accumulated all they could with the price FIXED (ie, CAPPED) at $35 an ounce. Having accumulated his pile, he then released the cap. That's business (if you can get away with it). The gold basically didn't disappear: it was in reserve, or recycled.
Then came oil, coal, and gas - some thought it was good to take it from the ground, use it, and even sell it. That was good business until there was no more of it in reserve or any long lasting accumulated pile. Goshes!!!
>a simpler lifestyle with less transport, and backyard gardens<
And the Statist Greens will make damn sure we have a simpler life style with their iron heel on our necks forever.
> Free Market Campers: How will the free market have the foresight
> to make changes required? Is the market really 'free' if environmental
> cost are not factored into your 'market price'? Free market suggest
> that there will be a boom and awful crash when the price of fossil
> fuels peaks and supply diminishes.
>
> It will be too late to develop alternatives.
How does the market have the foresight to make changes for anything? When you think about the market, first ask yourself, WHO is the market? The market isn't some abstract thing out there, you, me, tyler durden, your grandma, Tony Danza, we are all part of " the market".
How do people make choices? When I see the price of butter is 3 bucks and margerine is 2 bucks and I can't make the difference... I make the jump. That's the economy at work.
The free market doesn't suggest an "awful crash". A free market ( something we don't have mind you), is based on prices. Prices reflect scarcity. When prices go up ( for scarce goods) people consume less or trade to cheaper alternatives ( less scarce goods). That's more of a gradual process than say a government regulation or mandate that bans people from doing something.
> Conservatives don't want to hear about peak oil you say. Bully for
> them, because peak oil isn't important any longer. Why be concerned
> with peak oil …
Peak oil is about as relevant as social security expenses or the US national debt. I suspect when the time comes, our pragmatic society and its illustrious leaders will just pass another law to challenge the legitimacy of the laws of Physics, Thermodynamics and God.
> Somebody should wake up.
Didn't the US increase oil, NG output last yr? Expert?
Though it won't last, it did happen.
In your fantasy "new" energy world, what is going to power large vehicles, tractors, semis, etc? maybe some solar cells panelled across every surface? hoping the sun shines today, so we can deliver, mine, or plow? Or maybe, a row of propellers bolted on top out of the way, to power an electric turbine? hoping the wind blows today so the nations economy will run? hahaha, what a clueless fukwit ya are!!
I couldn't believe when he told the very small audience of 5 people that the average home system would cost $58,000. And with the federal 30% tax credit it would cost $40,000.
He also stated the efficiency is maximum when the panels face south, and less when facing other directions. Also, if a portion of the system is blocked by trees or other obstructions, the efficiency drops dramatically.
First of all, who can afford to lay out this kind of money for a payback period in tens of decades, especially in a depressed economy that we currently are in? And secondly, how many homes have their roof pointed in the right direction with no obstructions to gain maximum efficiency?
I tell ya', it's pure nonsense.
On Sep 02 12:23 PM nakedjaybird wrote:
> paulsjj - where were you when the US went from a manufacturing country
> to a services country???
n Sep 03 01:07 AM bogoMIPs wrote:
> Hey jerrydd,
>
> In your fantasy "new" energy world, what is going to power large
> vehicles, tractors, semis, etc? maybe some solar cells panelled
> across every surface? hoping the sun shines today, so we can deliver,
> mine, or plow? Or maybe, a row of propellers bolted on top out of
> the way, to power an electric turbine? hoping the wind blows today
> so the nations economy will run? hahaha, what a clueless fukwit
> ya are!!
A knee jerk ditto head you sound like.
First I never said get rid of oil, just become independent of imported oil and make it pay it's real cost. Nor do I say PV is good now. I said solar CSP.
Semi's can and should go NG as it's far cheaper. Short range trucks can go electric and longer range ones, NG or hybrid. Farm equipment can make their own fuels in many ways from ethanol, Methane, biodiesel.
Most mining converted to electric decades ago. Just not smart running engines in most mines. Makes it kind of hard to breathe.
I think the clueless one is you.
.
n Sep 03 01:07 AM bogoMIPs wrote:
> Hey jerrydd,
>
> In your fantasy "new" energy world, what is going to power large
> vehicles, tractors, semis, etc? maybe some solar cells panelled
> across every surface? hoping the sun shines today, so we can deliver,
> mine, or plow? Or maybe, a row of propellers bolted on top out of
> the way, to power an electric turbine? hoping the wind blows today
> so the nations economy will run? hahaha, what a clueless fukwit
> ya are!!
A knee jerk ditto head you sound like.
First I never said get rid of oil, just become independent of imported oil and make it pay it's real cost. Nor do I say PV is good now. I said solar CSP.
Semi's can and should go NG as it's far cheaper. Short range trucks can go electric and longer range ones, NG or hybrid. Farm equipment can make their own fuels in many ways from ethanol, Methane, biodiesel.
Most mining converted to electric decades ago. Just not smart running engines in most mines. Makes it kind of hard to breathe.
I think the clueless one is you.
.