Posts from — June 2009

The steady winds of New Zealand have allowed the country’s wind turbines to have the highest capacity factors for the wind in the world (around 37–40 percent). However, wind still has a cost premium to alternatives and is intermittent. In addition, output is about 10 percent below average in the autumn and early winter when it is most needed in New Zealand. The country’s abundant hydro resources (and pumped storage) cannot rescue wind from its intermittency and seasonality problems.

Prospectively, greater reliance on wind from government edicts is throwing good money after bad. Non-intermittent sources are far cheaper, not just reliable. A let-the-market-decide policy is needed in New Zealand as for the rest of the world.

Background 

The enthusiasm for renewable energy in the form of windpower, marine power, and the like, is driven by a belief that man-made greenhouse gases will cause dangerous global warming and that large-scale adoption of these technologies will “fight climate change.” To this end, thousands of megawatts (MW) of heavily subsidized wind power capacity are being added worldwide each year. [Read more →]

Chip Knappenberger was perhaps the first analyst to demonstrate the negligible impact on global temperatures that would result from unilateral U.S. adoption of the pending Waxman-Markey bill. Knappenberger showed that even if the U.S. cut its emissions by 83% (of the 2005 level) by the year 2050, and then capped them at that level indefinitely, the schedule of global temperature increases would only be postponed by about five years.

Naturally, supporters of strong government action argued that the whole point of Waxman-Markey was to give American negotiators credibility when they demanded reciprocal action from other countries; Paul Krugman says as much in a recent blog post. Yet this leads to the next major problem: If the whole world adopted the stringent emission cutbacks in Waxman-Markey, then the costs to the global economy would far outweigh any reasonable estimate of the benefits (measured in avoided climate damage).

I explained this point in a previous post, but since then Resources for the Future (RFF) has released an excellent primer on climate mitigation policies. Even though two of the papers’ authors now work for the Obama administration, it too agrees with me: Standard economic analyses cannot justify the sharp emission cuts laid out in Waxman-Markey. Its costs far outweigh its benefits, as a simple perusal of the “consensus” models will show. [Read more →]

Many analysts (including myself) have written about the innumerable problems with cap-and-trade, mostly focusing on the bogus nature of the trade. And most of the problems we’ve predicted have found their way into the current cap-and-trade law working its way through Congress, the American Clean Energy and Security Act of 2009 (Waxman-Markey climate bill).

As was widely predicted, Waxman-Markey has degenerated into little more than a special-interest pork-fest, where the political system is getting ready to give away at least 85% of the valuable emission permits to favored energy constituencies such as electrical utilities, university researchers, low-income households, renewable manufacturers, anti-deforestation programs, and so on. The Obama administration’s pledge to auction off 100% of the emission permits was a joke on the face of it: virtually all emission trading programs feature extensive “grandfathering” of polluters and favored constituencies.

Principled environmentalists have turned their guns on what has emerged. Michael Shellenberger of the Breakthrough Institute, in particular, has explained that it’s not only the trade elements of Waxman-Markey that are bogus, it’s the cap as well. It turns out that under Waxman-Markey’s byzantine provisions, “carbon emissions in regulated sectors of the U.S. economy [are] to rise at business as usual (BAU) rates through 2030.” [Read more →]

Even if energy realists and their allies fend off Waxman-Markey, wave after wave of global warming regulation could still sweep across the U.S. economy under the aegis of EPA and the Clean Air Act.  

As explained in a previous post, the carbon dioxide (CO₂) litigation campaign that begat the Supreme Court’s Massachusetts v. EPA decision (April 2007) could shut down much of our economy and replace self-government via the people’s elected representatives with the rule of bureaucrats and courts.

Energy realists need to school themselves in this constellation of issues, because the clock is ticking. On April 17, the Environmental Protection Agency, responding to Mass. v. EPA, published a proposed rule concluding that greenhouse gas (GHG) emissions from new motor vehicles cause or contribute to health- and welfare-endangering “air pollution.”  The comment period ends on June 23. [Read more →]

Over the past year, as the party in power has proposed one restrictive measure after another for the oil and gas production industry, analysts have been busy guessing how much this would cost us in foregone production and tax revenue. In an analysis featuring welcome candor, the Energy Department’s Energy Information Administration (EIA) has estimated oil and gas production in the United States with and without restrictions. By the end of the next decade (2019), restrictive permitting and tax policies will reduce the potential annual government tax take from oil and gas production by more than the total expected yield of the Obama tax program in the oil and gas sector. In the ten years to 2019, the time-frame used in the government’s tax increase proposal, restrictions and new taxes will have reduced the tax take from oil and gas production by more than $118 billion, or about 4 times the expected yield of the new taxes. Some deal, eh? [Read more →]

“It will be possible to achieve a 100% clean power mix over the next ten years if appropriate policies are put in place to unleash the [zero carbon source] technologies’ vast potential.”

- Repower America (The Alliance for Climate Protection)

The heavily bankrolled climate alarmist/energy coercion lobby, led by Al Gore’s new national organization Repower America, is coming to a town or city near you!

In Houston, they have arrived. The “Repower Texas” campaign is being fronted by a group of government-dependent political capitalists that see Big Green (as in money) in Texas’s renewable energy mandates. And how did this business underclass get started? It began with the Ken Lay/Enron renewables mandate for the Lone Star State in 1999, and the policy begun by then-governor George W. Bush is being continued today by governor Rick Perry.

The big question now is if renewable mandate #3 will be voted out by the Texas legislature and whether Governor Perry will sign it.  If so, hapless electricity ratepayers in the Lone Star State will be paying for a massively uneconomic solar boom just like they are already paying for the (artificial) wind boom.

Repower America/Repower Texas should be a wake-up call to taxpayers, ratepayers, and real energy producers. Make no mistake: the parasitic (intermittent, uneconomic) energies are after the markets now met by consumer-chosen, economic energies.

In short, the free-market energy economy has been put into political play. Expect a lot of counter-education in the name of “Don’t Depower Texas.”

Here is the call to action from Depower Repower Texas. [Read more →]