Criteria for good energy policy...
Today’s post: Weds, 6-18-2008
In his book, The Effective Executive, Peter Drucker listed several key ways the effective executives he’d met used to be so effective.
Three that relate well to energy policy are:
1. Focus on Contribution What is the most useful & valuable purpose of my efforts? And, how can I best contribute to achieving that purpose?
2. Refuse to be limited or stalled by what you cannot do. Find the most promising things you CAN do & do as many of those as you can.
3. When you make a major decision, think through in advance what criteria or characteristics an ideal decision would need to have. He called these criteria boundary conditions.
In energy policy here are some of what I see as being these boundary conditions or criteria for energy policy for the United States.
a) Will the decision prevent severe economic problems in the short run?
b) Will the decision prevent severe economic problems in the near future & far future?
c) Will it help us or hinder us in lowering CO2 emissions in time to prevent the foreseeable huge problems not doing so will cause?
d) Will it help us or hinder us in removing & ending our over-dependence on oil and coal as energy sources?
e) Will it serve as a good example to other countries in the world in reaching these objectives?
f) Will the technologies, products, & services – and businesses developed be helpful to countries in the world in reaching these objectives?
g) Will it make the United States self sufficient in its energy supplies and end our dangerous over-dependence on energy sources elsewhere in the world?
If you have been paying attention to the news & want an energy policy that does a good job, I think you’ll agree that these are the right boundary conditions.
The bad news is that the only one of these the outgoing Bush administration has done a good job on is the first one.
They have done some work on the others here and there. But so little that it’s clear these are not priorities for them.
Unfortunately, the vast majority of the Republicans in our congress & their Presidential nominee, John McCain, seem to be only focused on the first one & the last one.
I’d be just as happy to support Republicans as I would Democrats who would make ALL of these priorities. I am registered as a Republican largely because I am pro business. And, I even campaigned for a Republican not long ago who would support ALL of these boundary conditions & understood why that’s necessary.
But most of today’s Republicans now in office are stuck in the outmoded thinking of the outgoing Bush administration.
In my view, we court economic disaster & devastation of the security of the United States if we keep these people in office.
We simply no longer can afford such incomplete & dangerous energy policies.
To be specific, this group has suggested much more domestic oil production by drilling in coastal areas & in Alaska that are now off limits to drilling for oil. They also have voted against taxing oil companies who decline to invest some of their large, current profits in transitioning to renewable energy sources in part because it would take funds & management attention away from extracting more oil from within the United States.
They have proposed efforts to burn coal more safely with far less CO2 release & large increases in nuclear power plants.
To be sure these would increase our domestic energy production & help to slow down the near term rise in fuel prices which looks like it would be of some help in protecting our economy in the short run and would lessen our dependence on energy supplies for a while.
Although it is very difficult to do with sufficient safety and is thus very, very expensive to do well enough to be safe to use, more nuclear power may well serve most of these boundary conditions. As I recently posted on, doing this is a good bit more doable than most people realize. And, energy-wise it would generate a lot more energy than it would cost to build in the amount of energy used to do it.
In addition, we now use so much coal that it’s clear we do need a way to reduce the CO2 released by coal burning power plants while we transition to other sources.
The two pieces of bad news are that their emphasis on drilling for more domestic oil and NOT having any significant emphasis on energy efficiency or dramatic increases in renewable energy generation are totally wrong policies.
As just one example, if we obtain more domestic oil by drilling in places now off limits, the world supply of oil will at least temporarily go up. More will be burned & more CO2 will be released. And, it will make it look as if it’s economically safe to ignore the pressing need to address these other issues.
This would generate MORE CO2 when it’s extremely important to use less. And it tends to postpone action on other ways to protect the economy short term that help us speed the transition to renewable sources that do not do this
If we must insist that all these boundary conditions be met -- and I think it’s clear we must, then this policy is not just wrong, it’s incompetent.
I’d love to have Republicans who understand these issues. And, as I’ve said I campaigned for one, precisely because he did.
But the current crop of them does not & seemingly will not.
Unfortunately, at this time, that looks as if it includes John McCain.
There is no guarantee that Barack Obama will be able to solve these problems as they are very challenging indeed. But he has a chance. He hasn’t run on his energy policies as well as I think he could & should have. But it’s clear he does know we need decisions that meet all these criteria.
But, I think John McCain is looking like his policies would be sure to prevent him from doing much better than George Bush who has done far too little, too late.
To me that makes McCain look like a very bad choice on the most important set of issues today.
Wednesday, June 18, 2008
Wednesday, June 11, 2008
Energy upgrades needed to protect the economy....
Today’s post: Weds, 6-11-2008
Relying on fossil fuels for energy, we are now realizing, is NOT environmentally safe. This is particularly true for burning coal; but it’s also true even if to a slightly smaller extent for burning natural gas.
What is still often missed even with the recent run up in the price of oil -- & of gasoline in the United States, is that it is no longer ECONOMICALLY safe.
When they are healthy, economies grow. And, usually populations grow. So the demand for energy will reliably increase as economies can only grow if they have access to more energy.
Since our supplies of fossil fuels are finite, & our effective access may even have begun to shrink, this means that the time has come or will very soon that prices will go up & that will likely accelerate if we continue to use fossil fuels only. It’s also incredibly important that we have put other sources in place well before we run out totally.
In addition, to these last comments that were in last week’s post, here are some more related points.
Severe weather, droughts, floods, &disruptions to water supplies can & do cost millions & millions of dollars. They also can cause health problems & deaths.
And, flooding of developed & populated coastal areas can create similar problems. Some things can be located to higher ground & some areas be protected with dikes as the Dutch have done for centuries. But not all of the people & economic value can be salvaged given such flooding world wide. And, these protective steps cost a lot of money.
Increases in tropical & insect borne diseases from global warming have similar risks & costs.
If we can prevent or minimize all these things, by adding renewable energy on a massive scale, sharply increasing energy efficiency, & likely also adding a good bit more nuclear power, the money saved will likely be larger than the costs, however high, of these energy upgrades & transitions.
Here’s a recent report suggesting it really is necessary to do all of the above.:
“$45 trillion needed to combat warming
By JOSEPH COLEMAN, Associated Press Writer Fri Jun 6, 7:06 AM ET
TOKYO - The world needs to invest $45 trillion in energy in coming decades, build some 1,400 nuclear power plants and vastly expand wind power in order to halve greenhouse gas emissions by 2050, according to an energy study released Friday.
2008
The report by the Paris-based International Energy Agency envisions a "energy revolution" that would greatly reduce the world's dependence on fossil fuels while maintaining steady economic growth "Meeting this target of 50 percent cut in emissions represents a formidable challenge, and we would require immediate policy action and technological transition on an unprecedented scale," IEA Executive Director Nobuo Tanaka said.
A U.N.-network of scientists concluded last year that emissions have to be cut by at least half by 2050 to avoid an increase in world temperatures of between 3.6 and 4.2 degrees above pre-18th century levels.
Scientists say temperature increases beyond that could trigger devastating effects, such as widespread loss of species, famines and droughts, and swamping of heavily populated coastal areas by rising oceans.
Environment ministers from the Group of Eight industrialized countries and Russia backed the 50 percent target in a meeting in Japan last month and called for it to be officially endorsed at the G-8 summit in July.
The IEA report mapped out two main scenarios: one in which emissions are reduced to 2005 levels by 2050, and a second that would bring them to half of 2005 levels by mid-century.
The scenario for deeper cuts would require massive investment in energy technology development and deployment, a wide-ranging campaign to dramatically increase energy efficiency, and a wholesale shift to renewable sources of energy.
Assuming an average 3.3 percent global economic growth over the 2010-2050 period, governments and the private sector would have to make additional investments of $45 trillion in energy, or 1.1 percent of the world's gross domestic product, the report said.
That would be an investment more than three times the current size of the entire U.S. economy.”
As I remember, this report also said that a large number of new nuclear plants would need to be built as well.
But there can be no doubt that we must “massive investment in energy technology development and deployment, a wide-ranging campaign to dramatically increase energy efficiency, and a wholesale shift to renewable sources of energy” whether or not we add more nuclear power if we are to avoid severe economic collapses at some point in the next 20 to 50 years.
Of course, 1.1 % of the entire world economy is a LOT of money. But it IS doable.
Meanwhile, in the United States, two measures to move in the needed direction were defeated recently.
1. Oil companies currently have the money to invest in beginning to shift their businesses to providing energy & transport fuels with renewable sources – not just oil.
I’d strongly prefer that they do this themselves as it seems to me to be prudent management on their part. And, I personally prefer businesses to do things rather than be pushed by government regulation.
But the need is clear. We are already 10 to 25 years late in starting to make these changes & are running out of time.
The largest oil companies have simply NOT done the job & begin to look as if they are incapable of it on their own.
So, when the bill for the US government to step in with tax policies to jump start this change—which is actually in the best interests of the oil companies in my view, was defeated recently, I think every legislator who voted against this bill, should be replaced in the next election for that district. It does NOT matter if they are Republicans or Democrats, I think they should be opposed next time if they run for election again in BOTH the primaries & the actual election.
We cannot afford the delay their lack of knowledge & understanding will otherwise cost us.
2. Similarly, the current bill to renew R & D tax credits & existing tax credits for renewable energy lost recently.
If this situation is not repaired, the United Sates will become less economically competitive due to reductions in R & D spending. And we will GO BACKWARDS on implementing renewable energy at a time we should be quadrupling our efforts.
The legislators who either introduced killer amendments or riders to this bill or voted against it, must be replaced at the next election.
We cannot afford the delay their lack of knowledge & understanding will otherwise cost us.
Our economy, our survival, & our way of life may well depend on replacing these people with legislators who will help speed the solution to these problems instead of voting against solutions or delaying solutions.
Today’s post: Weds, 6-11-2008
Relying on fossil fuels for energy, we are now realizing, is NOT environmentally safe. This is particularly true for burning coal; but it’s also true even if to a slightly smaller extent for burning natural gas.
What is still often missed even with the recent run up in the price of oil -- & of gasoline in the United States, is that it is no longer ECONOMICALLY safe.
When they are healthy, economies grow. And, usually populations grow. So the demand for energy will reliably increase as economies can only grow if they have access to more energy.
Since our supplies of fossil fuels are finite, & our effective access may even have begun to shrink, this means that the time has come or will very soon that prices will go up & that will likely accelerate if we continue to use fossil fuels only. It’s also incredibly important that we have put other sources in place well before we run out totally.
In addition, to these last comments that were in last week’s post, here are some more related points.
Severe weather, droughts, floods, &disruptions to water supplies can & do cost millions & millions of dollars. They also can cause health problems & deaths.
And, flooding of developed & populated coastal areas can create similar problems. Some things can be located to higher ground & some areas be protected with dikes as the Dutch have done for centuries. But not all of the people & economic value can be salvaged given such flooding world wide. And, these protective steps cost a lot of money.
Increases in tropical & insect borne diseases from global warming have similar risks & costs.
If we can prevent or minimize all these things, by adding renewable energy on a massive scale, sharply increasing energy efficiency, & likely also adding a good bit more nuclear power, the money saved will likely be larger than the costs, however high, of these energy upgrades & transitions.
Here’s a recent report suggesting it really is necessary to do all of the above.:
“$45 trillion needed to combat warming
By JOSEPH COLEMAN, Associated Press Writer Fri Jun 6, 7:06 AM ET
TOKYO - The world needs to invest $45 trillion in energy in coming decades, build some 1,400 nuclear power plants and vastly expand wind power in order to halve greenhouse gas emissions by 2050, according to an energy study released Friday.
2008
The report by the Paris-based International Energy Agency envisions a "energy revolution" that would greatly reduce the world's dependence on fossil fuels while maintaining steady economic growth "Meeting this target of 50 percent cut in emissions represents a formidable challenge, and we would require immediate policy action and technological transition on an unprecedented scale," IEA Executive Director Nobuo Tanaka said.
A U.N.-network of scientists concluded last year that emissions have to be cut by at least half by 2050 to avoid an increase in world temperatures of between 3.6 and 4.2 degrees above pre-18th century levels.
Scientists say temperature increases beyond that could trigger devastating effects, such as widespread loss of species, famines and droughts, and swamping of heavily populated coastal areas by rising oceans.
Environment ministers from the Group of Eight industrialized countries and Russia backed the 50 percent target in a meeting in Japan last month and called for it to be officially endorsed at the G-8 summit in July.
The IEA report mapped out two main scenarios: one in which emissions are reduced to 2005 levels by 2050, and a second that would bring them to half of 2005 levels by mid-century.
The scenario for deeper cuts would require massive investment in energy technology development and deployment, a wide-ranging campaign to dramatically increase energy efficiency, and a wholesale shift to renewable sources of energy.
Assuming an average 3.3 percent global economic growth over the 2010-2050 period, governments and the private sector would have to make additional investments of $45 trillion in energy, or 1.1 percent of the world's gross domestic product, the report said.
That would be an investment more than three times the current size of the entire U.S. economy.”
As I remember, this report also said that a large number of new nuclear plants would need to be built as well.
But there can be no doubt that we must “massive investment in energy technology development and deployment, a wide-ranging campaign to dramatically increase energy efficiency, and a wholesale shift to renewable sources of energy” whether or not we add more nuclear power if we are to avoid severe economic collapses at some point in the next 20 to 50 years.
Of course, 1.1 % of the entire world economy is a LOT of money. But it IS doable.
Meanwhile, in the United States, two measures to move in the needed direction were defeated recently.
1. Oil companies currently have the money to invest in beginning to shift their businesses to providing energy & transport fuels with renewable sources – not just oil.
I’d strongly prefer that they do this themselves as it seems to me to be prudent management on their part. And, I personally prefer businesses to do things rather than be pushed by government regulation.
But the need is clear. We are already 10 to 25 years late in starting to make these changes & are running out of time.
The largest oil companies have simply NOT done the job & begin to look as if they are incapable of it on their own.
So, when the bill for the US government to step in with tax policies to jump start this change—which is actually in the best interests of the oil companies in my view, was defeated recently, I think every legislator who voted against this bill, should be replaced in the next election for that district. It does NOT matter if they are Republicans or Democrats, I think they should be opposed next time if they run for election again in BOTH the primaries & the actual election.
We cannot afford the delay their lack of knowledge & understanding will otherwise cost us.
2. Similarly, the current bill to renew R & D tax credits & existing tax credits for renewable energy lost recently.
If this situation is not repaired, the United Sates will become less economically competitive due to reductions in R & D spending. And we will GO BACKWARDS on implementing renewable energy at a time we should be quadrupling our efforts.
The legislators who either introduced killer amendments or riders to this bill or voted against it, must be replaced at the next election.
We cannot afford the delay their lack of knowledge & understanding will otherwise cost us.
Our economy, our survival, & our way of life may well depend on replacing these people with legislators who will help speed the solution to these problems instead of voting against solutions or delaying solutions.
Wednesday, June 4, 2008
Financing to speed Renewable Energy Transition....
Today’s post: Weds, 6-4-2008
Relying on fossil fuels for energy, we are now realizing, is NOT environmentally safe. This is particularly true for burning coal; but it’s also true even if to a slightly smaller extent for burning natural gas.
What is still often missed even with the recent run up in the price of oil -- & of gasoline in the United States, is that it is no longer ECONOMICALLY safe.
When they are healthy, economies grow. And, usually populations grow. So the demand for energy will reliably increase as economies can only grow if they have access to more energy.
Since our supplies of fossil fuels are finite, & our effective access may even have begun to shrink, this means that the time has come or will very soon that prices will go up & that will likely accelerate if we continue to use fossil fuels only. It’s also incredibly important that we have put other sources in place well before we run out totally.
The good news is that solar photovoltaics & solar thermal electricity are already approaching being LESS expensive ways to generate electricity than burning fossil fuels to do so.
And, now that increasingly, regulation will be used to put some of the environmental cost of burning fossil fuels into their cost, fossil fuel prices will rise faster than the economy can easily adjust to.
We may be able to solve that problem in part with increased use of nuclear energy as we have posted about before here. But the costs of being absolutely sure that it is done safely, though it looks doable, will keep the costs from being low of electricity generated by nuclear energy.
In addition, the political resistance of people concerned with these safety & security issues will guarantee that to the extent we do use nuclear energy, in the near term it will not come online quickly.
So, that means we are facing real economic disaster maybe within 20 or 30 years & possibly even sooner from rising fossil fuel prices if we fail to put massive amounts of solar generated electricity & other renewable sources of electricity in place very soon.
Meanwhile, many homeowners, owners of rental properties, & businesses do NOT have the cash or safe to use credit to finance installing solar electric power generation at their home or facilities.
To some degree, governments & utility companies will solve this problem by building solar electricity generation in more concentrated & centralized facilities. Some utilities are already doing so, which is an encouraging sign. And, Nanosolar is working to have many city governments do likewise – using its products of course. But they make a convincing case for it.
But these programs take time to bring online & they are NOT enough by themselves to produce all the solar generated electricity we need.
The good news is that if the financing was somehow available so that property owners in favorable locations could install solar photovoltaic panels on their property, it looks quite likely that increasingly the cost per month of the financing will be LESS & then MUCH LESS than the cost of buying the same electricity from fossil fuel powered sources.
And, if this financing were available, any given property can have the installation done in less than two months & less than 3 weeks in many cases.
This means that if the financing were available, hundreds of thousands of property owners or even millions could install solar in just a few years.
Although it is not available to everyone or desirable for everyone, the good news is that some such financing is actually available NOW.
It seems that there is a company called Tioga Energy in San Mateo, California with website: http://www.tiogaenergy.com/ that makes such financing available to some businesses.
Their conservative mathematical analysis in the paper they offer on their website shows that by historical standards a qualifying business has about a two thirds chance of paying less for the contract payment to Tioga Energy per month than they would pay if they continue buy fossil fuel energy, particularly in California.
It looks to me that the chances are quite a bit closer to 100% & that the savings will be at least triple the payments to Tioga Energy over the time period of the contract they put in place.
And, they make the excellent point that business paying them have predictable costs that will NOT suddenly double in two years or worse. Businesses getting electricity from sources that burn fossil fuels may well have those problems.
There are basically 3 constraints; & so far only businesses can apply:
1. The facility of the business must be in an area where enough solar electricity will be generated to produce enough electricity to make the numbers work.
2. Only stable businesses that own their facility & property will be able to do the long term contract necessary.
3. Solar systems are not yet well designed to be folded back for new roofs to be installed. So a new roof with enough reliable life must be in place or installed. And, it must be financed separately.
Even with the constraints though, this is an extremely good idea. And, I think it will save those businesses that do become customers a LOT of money.
And, since this is already in place, as solar cells come down in price & go up in efficiency, solar installations become designed to be moved easily for roof repairs or replacement or fire access, & the price of fossil fuels doubles again & again, I think this business will grow.
And, I think governments may well step in to make it possible & economic for businesses that lease their facilities & home owners & owners of residential rental estate to do a deal with the government agency so that they can also participate in such financing.
Lastly, if you have a qualifying business, one of the great advantages of the service provided by Tioga Energy is they deal with all the permitting & incentive paperwork for the solar installation.
Unfortunately, this is so complex & difficult now, in a business where the owners or executives need to get the work of the business done, they simply may not have the time to orchestrate a solar installation. In that event, Tioga Energy can get the solar installation done with no time needed from the management of the business.
Today’s post: Weds, 6-4-2008
Relying on fossil fuels for energy, we are now realizing, is NOT environmentally safe. This is particularly true for burning coal; but it’s also true even if to a slightly smaller extent for burning natural gas.
What is still often missed even with the recent run up in the price of oil -- & of gasoline in the United States, is that it is no longer ECONOMICALLY safe.
When they are healthy, economies grow. And, usually populations grow. So the demand for energy will reliably increase as economies can only grow if they have access to more energy.
Since our supplies of fossil fuels are finite, & our effective access may even have begun to shrink, this means that the time has come or will very soon that prices will go up & that will likely accelerate if we continue to use fossil fuels only. It’s also incredibly important that we have put other sources in place well before we run out totally.
The good news is that solar photovoltaics & solar thermal electricity are already approaching being LESS expensive ways to generate electricity than burning fossil fuels to do so.
And, now that increasingly, regulation will be used to put some of the environmental cost of burning fossil fuels into their cost, fossil fuel prices will rise faster than the economy can easily adjust to.
We may be able to solve that problem in part with increased use of nuclear energy as we have posted about before here. But the costs of being absolutely sure that it is done safely, though it looks doable, will keep the costs from being low of electricity generated by nuclear energy.
In addition, the political resistance of people concerned with these safety & security issues will guarantee that to the extent we do use nuclear energy, in the near term it will not come online quickly.
So, that means we are facing real economic disaster maybe within 20 or 30 years & possibly even sooner from rising fossil fuel prices if we fail to put massive amounts of solar generated electricity & other renewable sources of electricity in place very soon.
Meanwhile, many homeowners, owners of rental properties, & businesses do NOT have the cash or safe to use credit to finance installing solar electric power generation at their home or facilities.
To some degree, governments & utility companies will solve this problem by building solar electricity generation in more concentrated & centralized facilities. Some utilities are already doing so, which is an encouraging sign. And, Nanosolar is working to have many city governments do likewise – using its products of course. But they make a convincing case for it.
But these programs take time to bring online & they are NOT enough by themselves to produce all the solar generated electricity we need.
The good news is that if the financing was somehow available so that property owners in favorable locations could install solar photovoltaic panels on their property, it looks quite likely that increasingly the cost per month of the financing will be LESS & then MUCH LESS than the cost of buying the same electricity from fossil fuel powered sources.
And, if this financing were available, any given property can have the installation done in less than two months & less than 3 weeks in many cases.
This means that if the financing were available, hundreds of thousands of property owners or even millions could install solar in just a few years.
Although it is not available to everyone or desirable for everyone, the good news is that some such financing is actually available NOW.
It seems that there is a company called Tioga Energy in San Mateo, California with website: http://www.tiogaenergy.com/ that makes such financing available to some businesses.
Their conservative mathematical analysis in the paper they offer on their website shows that by historical standards a qualifying business has about a two thirds chance of paying less for the contract payment to Tioga Energy per month than they would pay if they continue buy fossil fuel energy, particularly in California.
It looks to me that the chances are quite a bit closer to 100% & that the savings will be at least triple the payments to Tioga Energy over the time period of the contract they put in place.
And, they make the excellent point that business paying them have predictable costs that will NOT suddenly double in two years or worse. Businesses getting electricity from sources that burn fossil fuels may well have those problems.
There are basically 3 constraints; & so far only businesses can apply:
1. The facility of the business must be in an area where enough solar electricity will be generated to produce enough electricity to make the numbers work.
2. Only stable businesses that own their facility & property will be able to do the long term contract necessary.
3. Solar systems are not yet well designed to be folded back for new roofs to be installed. So a new roof with enough reliable life must be in place or installed. And, it must be financed separately.
Even with the constraints though, this is an extremely good idea. And, I think it will save those businesses that do become customers a LOT of money.
And, since this is already in place, as solar cells come down in price & go up in efficiency, solar installations become designed to be moved easily for roof repairs or replacement or fire access, & the price of fossil fuels doubles again & again, I think this business will grow.
And, I think governments may well step in to make it possible & economic for businesses that lease their facilities & home owners & owners of residential rental estate to do a deal with the government agency so that they can also participate in such financing.
Lastly, if you have a qualifying business, one of the great advantages of the service provided by Tioga Energy is they deal with all the permitting & incentive paperwork for the solar installation.
Unfortunately, this is so complex & difficult now, in a business where the owners or executives need to get the work of the business done, they simply may not have the time to orchestrate a solar installation. In that event, Tioga Energy can get the solar installation done with no time needed from the management of the business.
Wednesday, May 28, 2008
Oil companies & new political policies....
Today’s post: Weds, 5-28-2008
Just before sailing ships were replaced by powered ships, initially steam driven, the clipper ship was developed.
It was the best & most evolved design for sailing ships. But it soon disappeared from world commerce & became an antique.
Oil companies are becoming the clipper ships of today.
They are highly evolved to find, transport, refine, & sell oil for fuel & petrochemicals.
And, with shareholders to report to, record profits now, & rising demand, they are mostly deciding to try to respond to rising demand at time when supply is getting harder to obtain.
The executives would be fired by their shareholders if they didn’t.
However, the major oil companies are reported to be doing that ONLY. Some oil companies that have invested in alternative energy sources are even reported to be trying to sell them & leave the field of alternative energy sources.
The Rockefeller shareholders of Exxon Mobil are correct in my view that to decline to use a significant part of the very high profits & cash available to move into alternative sources of energy jeopardizes the future economic viability of the oil companies.
Meanwhile, driven by the rapidly escalating costs both in dollars & environmental impact, the rest of the world is switching to cost effective biofuels, renewable energy sources, & nuclear power plus plug-in hybrid & electric cars. And, more people will begin to telecommute.
It will take longer than is good for our economy both in the United States & worldwide to transition from fossil fuels to other sources. But, if we survive the problems that causes & make the transition successfully, which we still have a shot at doing, oil companies will still have petrochemicals for what oil remains. But they will become depleted relics of their current selves in size & profitability. The action is moving elsewhere. And, if oil companies don’t get into it with part of their money, they will become the clipper ships of our time. Unfortunately for them, that is the course they seem to be all following today.
One of the promising signs that we may make it is that the increasingly mandated use of renewable fuels & reductions in CO2 by governments is beginning to drive really large markets for virtually all the alternative energy sources.
Another is that if the major oil companies continue to decline to make this investment themselves, there are increasing signs they will be taxed in various ways by governments who will then invest in alternative sources separately from the oil companies.
As improved technology is adapted & the market responds, the governments will up the ante in all these areas & the process will accelerate.
Which oil companies will be large scale players on the world scene then?
Some who don’t want to be the clipper ships of today, will be; but based on today’s news, most of them will not.
The really unfortunate thing is that they have the money to do both.
They can maximize the oil they can deliver while it is still at a premium as best they can AND create a viable foothold in the alternative energy sources of tomorrow.
As someone who grew up in oil country & benefited from the prosperity the oil companies created there as a kid & as young man, I hope some of them smarten up in time.
But of most importance, I hope we make the transition in time to avoid really horrible economic problems without their help as it now looks likely we will need to do.
Today’s post: Weds, 5-28-2008
Just before sailing ships were replaced by powered ships, initially steam driven, the clipper ship was developed.
It was the best & most evolved design for sailing ships. But it soon disappeared from world commerce & became an antique.
Oil companies are becoming the clipper ships of today.
They are highly evolved to find, transport, refine, & sell oil for fuel & petrochemicals.
And, with shareholders to report to, record profits now, & rising demand, they are mostly deciding to try to respond to rising demand at time when supply is getting harder to obtain.
The executives would be fired by their shareholders if they didn’t.
However, the major oil companies are reported to be doing that ONLY. Some oil companies that have invested in alternative energy sources are even reported to be trying to sell them & leave the field of alternative energy sources.
The Rockefeller shareholders of Exxon Mobil are correct in my view that to decline to use a significant part of the very high profits & cash available to move into alternative sources of energy jeopardizes the future economic viability of the oil companies.
Meanwhile, driven by the rapidly escalating costs both in dollars & environmental impact, the rest of the world is switching to cost effective biofuels, renewable energy sources, & nuclear power plus plug-in hybrid & electric cars. And, more people will begin to telecommute.
It will take longer than is good for our economy both in the United States & worldwide to transition from fossil fuels to other sources. But, if we survive the problems that causes & make the transition successfully, which we still have a shot at doing, oil companies will still have petrochemicals for what oil remains. But they will become depleted relics of their current selves in size & profitability. The action is moving elsewhere. And, if oil companies don’t get into it with part of their money, they will become the clipper ships of our time. Unfortunately for them, that is the course they seem to be all following today.
One of the promising signs that we may make it is that the increasingly mandated use of renewable fuels & reductions in CO2 by governments is beginning to drive really large markets for virtually all the alternative energy sources.
Another is that if the major oil companies continue to decline to make this investment themselves, there are increasing signs they will be taxed in various ways by governments who will then invest in alternative sources separately from the oil companies.
As improved technology is adapted & the market responds, the governments will up the ante in all these areas & the process will accelerate.
Which oil companies will be large scale players on the world scene then?
Some who don’t want to be the clipper ships of today, will be; but based on today’s news, most of them will not.
The really unfortunate thing is that they have the money to do both.
They can maximize the oil they can deliver while it is still at a premium as best they can AND create a viable foothold in the alternative energy sources of tomorrow.
As someone who grew up in oil country & benefited from the prosperity the oil companies created there as a kid & as young man, I hope some of them smarten up in time.
But of most importance, I hope we make the transition in time to avoid really horrible economic problems without their help as it now looks likely we will need to do.
Wednesday, May 21, 2008
Energy policy of the Presidential candidates....
Today’s post: Weds, 5-21-2008
A recent newspaper article compared the energy policies proposed by the 3 remaining candidates for President of the United States.
1. Both Barack Obama and Hillary Clinton were listed as proposing a goal of reducing C02 emissions to 80 % below 1990 levels by 2050.
John McCain was listed as proposing a goal of reducing C02 emissions to 60 % below 1990 levels by 2050.
This one is a mixed review.
Environmentally, 80 % is the number we likely need to get to. Advantage to the Democrats for that.
But given that we emitted more in 2006 than in 1990 by a good bit & 2007 was 1.6% ABOVE 2007 in the United States, 60 % below 1990 may be more achievable. And, sometimes setting more achievable goals produces more results than goals that sound good that no one believes are reachable.
But the big news is that McCain HAS a CO2 reduction goal.
Over-all, I rate this category as even.
2. On Nuclear Energy as a solution, John McCain is strongly for it; Barack Obama is willing to use it but as a second priority AFTER adding renewable sources and energy efficiency get the most emphasis. Hillary Clinton has valid concerns about using nuclear energy but sounds like she simply would decline to use it if elected.
Obama & McCain sound like they would address the concerns but use some nuclear power.
Since in the early stages of renewable energy technology & deployment, it will have less capacity than nuclear power to reduce our dependence on oil as a national security issue & on both oil and coal for CO2 reduction, between Clinton & Obama, I rate this as a strong advantage to Obama.
Between Obama & McCain I think this comes out about even to slight advantage Obama. I totally agree with Obama that the first priority must be to dramatically increase our energy efficiency & to accelerate the development & deployment of renewable sources. So he gets the advantage on that part of it. But nuclear has the capacity to get fast progress in the early stages, so McCain’s stand on nuclear itself may be closer to what we really need.
All three support cap & trade arrangements with binding caps on CO2 emissions.
However, to get these to work, the oil companies need to invest some of their currently high profits AND their tax subsidies they currently get into diversifying into energy efficiently produced biofuels & electricity produced by renewable energy to be used by electric & plug-in hybrid vehicles.
Failing that, & mostly that has been the case, compared to what they clearly should be doing, it likely does make sense to gradually eliminate their tax breaks.
On the other hand, getting them to do the right thing instead of spending on lobbying to avoid it may depend on working with them rather than just pitting government power against their perceived interests.
The President that I think got the balance right between making real progress & avoiding excessive friction caused by ignoring the perceived interests of business was BILL Clinton. That’s why I am comfortable with Hillary as President if it were somehow to happen.
Obama shows signs of not understanding this issue enough to know how to manage it well while McCain comes across as too willing to continue the highly favored treatment of the oil companies that the Bush administration has had even if it compromises the development of renewable energy sources.
So I rate this category close to even now.
But my preference is for Obama to win & then bring on Bill Clinton as his advisor on this issue.
I don’t think we can afford to continue the policies of the Bush administration on energy.
The good news is that if McCain wins, things will be somewhat better instead of a total disaster.
The problem with that is for national security & to prevent frightening future environmental & economic problems from excessive fossil fuel use, somewhat better is NOT good enough.
It is closer than I expected early on; but I still think Obama is the most likely of the three to get the job done that we need to have done on energy policy.
(Based on his comments on renewable energy & energy policy in his book, I have been seriously disappointed in Obama’s failure to emphasize the importance of energy policy in his campaign & to explain to voters that getting it right will enable them to HAVE jobs & be able to afford to commute to them while not doing so at some point will have the reverse effect.
And, though it isn’t his strength, McCain’s energy positions are nowhere as weak as I expected them to be.)
Today’s post: Weds, 5-21-2008
A recent newspaper article compared the energy policies proposed by the 3 remaining candidates for President of the United States.
1. Both Barack Obama and Hillary Clinton were listed as proposing a goal of reducing C02 emissions to 80 % below 1990 levels by 2050.
John McCain was listed as proposing a goal of reducing C02 emissions to 60 % below 1990 levels by 2050.
This one is a mixed review.
Environmentally, 80 % is the number we likely need to get to. Advantage to the Democrats for that.
But given that we emitted more in 2006 than in 1990 by a good bit & 2007 was 1.6% ABOVE 2007 in the United States, 60 % below 1990 may be more achievable. And, sometimes setting more achievable goals produces more results than goals that sound good that no one believes are reachable.
But the big news is that McCain HAS a CO2 reduction goal.
Over-all, I rate this category as even.
2. On Nuclear Energy as a solution, John McCain is strongly for it; Barack Obama is willing to use it but as a second priority AFTER adding renewable sources and energy efficiency get the most emphasis. Hillary Clinton has valid concerns about using nuclear energy but sounds like she simply would decline to use it if elected.
Obama & McCain sound like they would address the concerns but use some nuclear power.
Since in the early stages of renewable energy technology & deployment, it will have less capacity than nuclear power to reduce our dependence on oil as a national security issue & on both oil and coal for CO2 reduction, between Clinton & Obama, I rate this as a strong advantage to Obama.
Between Obama & McCain I think this comes out about even to slight advantage Obama. I totally agree with Obama that the first priority must be to dramatically increase our energy efficiency & to accelerate the development & deployment of renewable sources. So he gets the advantage on that part of it. But nuclear has the capacity to get fast progress in the early stages, so McCain’s stand on nuclear itself may be closer to what we really need.
All three support cap & trade arrangements with binding caps on CO2 emissions.
However, to get these to work, the oil companies need to invest some of their currently high profits AND their tax subsidies they currently get into diversifying into energy efficiently produced biofuels & electricity produced by renewable energy to be used by electric & plug-in hybrid vehicles.
Failing that, & mostly that has been the case, compared to what they clearly should be doing, it likely does make sense to gradually eliminate their tax breaks.
On the other hand, getting them to do the right thing instead of spending on lobbying to avoid it may depend on working with them rather than just pitting government power against their perceived interests.
The President that I think got the balance right between making real progress & avoiding excessive friction caused by ignoring the perceived interests of business was BILL Clinton. That’s why I am comfortable with Hillary as President if it were somehow to happen.
Obama shows signs of not understanding this issue enough to know how to manage it well while McCain comes across as too willing to continue the highly favored treatment of the oil companies that the Bush administration has had even if it compromises the development of renewable energy sources.
So I rate this category close to even now.
But my preference is for Obama to win & then bring on Bill Clinton as his advisor on this issue.
I don’t think we can afford to continue the policies of the Bush administration on energy.
The good news is that if McCain wins, things will be somewhat better instead of a total disaster.
The problem with that is for national security & to prevent frightening future environmental & economic problems from excessive fossil fuel use, somewhat better is NOT good enough.
It is closer than I expected early on; but I still think Obama is the most likely of the three to get the job done that we need to have done on energy policy.
(Based on his comments on renewable energy & energy policy in his book, I have been seriously disappointed in Obama’s failure to emphasize the importance of energy policy in his campaign & to explain to voters that getting it right will enable them to HAVE jobs & be able to afford to commute to them while not doing so at some point will have the reverse effect.
And, though it isn’t his strength, McCain’s energy positions are nowhere as weak as I expected them to be.)
Wednesday, May 14, 2008
How can China use less Coal?....
Today’s post: Weds, 5-14-2008
There is a lot of good news about China.
Their ability to develop a huge manufacturing industry that so far has been able to manufacture goods & consumer goods at lower cost than in most developed countries has benefited the economies of the other countries in the world including the United States.
It has benefited many corporations in the United States & increased the value of their stock.
And, this has been one of the key causes of the relatively low inflation rate in the United States over the last 20 years.
In addition, they have done this with an enthusiastic can-do attitude aimed at progress much like the United States did as it became an economic power. As someone who lives in the Silicon Valley, I personally like their entrepreneurial style, their focus on progress on purpose, & their energy.
And, this cash coming into China has influenced China in the direction of becoming somewhat more peaceful & tolerant in its international relations. They now have a lot to lose if that cash were to stop arriving.
Unfortunately, they have increasingly relied on coal & new coal burning plants to power this manufacturing.
That has produced incredibly bad air pollution in China itself. Some of that air pollution is even making it across the Pacific to the United States. AND it has made China one of the biggest sources of CO2 on the planet. They are or shortly will be the country that generates the most CO2 each year in all the world.
That means that the people in China now have a lower quality of life and poorer health than they would if this energy could be produced without burning coal as they have been.
And, it means that we CANNOT solve CO2 driven global warming without China switching to cleaner energy sources that do not release CO2.
So, how can China use less coal? And, what can the United States & other developed countries do to make that happen better & faster?
Here are some thoughts.
1. It would DEFINITELY help if we dramatically reduced the coal WE burn for energy in the United States. China will be much more likely to do this also if we walk the talk. Further, the technology & practices we use to do this can be shared with China.
Similarly, it would help if we only allowed coal to be burned for energy if & ONLY IF absolutely all pollutants generated by burning the coal were removed from the air AND as fast as we learn how & get the equipment installed we sequester all of the CO2 generated.
If that was phased in over 10 years at existing coal burning facilities & no new coal burning plants were built, that would help solve global warming; it would gradually make coal generated electricity more expensive; & it would improve the competitiveness of nuclear, solar, & wind generated electricity which will help develop new technologies and increase our electricity generated from cleaner sources than coal.
2. Similarly, it would help if we did everything we could to pass on information to China on rolling out solar and wind power generation. This could range from licensing technology at discounted rates to export incentives to solar and wind power companies to export their products to China.
It helps that China is already developing its own solar companies.
3. Since China is already a member of the so called “nuclear club” in the world it also might make sense to work with them to build more nuclear plants to generate electricity in exchange for asking for commitments to high levels of safety, security, and safe disposal & storage.
4. Only after we do all three of these things do I think we should put any kind of diplomatic pressure on China to reduce the amount of coal they burn or place a tax or tariff on their manufactured products that are sent to this country to compensate for the costs of global warming if they don’t.
That may make good sense later if it is still necessary. But I think making a massive push to make these changes here & do everything we can to speed our own move away from coal and to help them in ways they will find useful and effective is much better.
This will do three things. It will give them some of the tools & some momentum in the right direction first. And, it will allow them to see our pressure at that point as coming from a friend rather than an enemy if we still need to exert it. And, of greatest importance, we will then be doing the right things ourselves instead of asking them to do so when we haven’t bothered to do them here.
5. A related thought occurs to me. With its lower cost of manufacturing, it might make sense to help China become a major manufacturer of LED light bulbs for home & small business lighting world wide. One of the barriers to rapid deployment of this energy saving technology is the high cost of such bulbs now. Why not help put China in a position to contribute world wide to solving this problem?
An important benefit of this would also be to help China use far less electricity for lighting itself -- which would also help them stop building new coal burning plants to generate electricity.
Today’s post: Weds, 5-14-2008
There is a lot of good news about China.
Their ability to develop a huge manufacturing industry that so far has been able to manufacture goods & consumer goods at lower cost than in most developed countries has benefited the economies of the other countries in the world including the United States.
It has benefited many corporations in the United States & increased the value of their stock.
And, this has been one of the key causes of the relatively low inflation rate in the United States over the last 20 years.
In addition, they have done this with an enthusiastic can-do attitude aimed at progress much like the United States did as it became an economic power. As someone who lives in the Silicon Valley, I personally like their entrepreneurial style, their focus on progress on purpose, & their energy.
And, this cash coming into China has influenced China in the direction of becoming somewhat more peaceful & tolerant in its international relations. They now have a lot to lose if that cash were to stop arriving.
Unfortunately, they have increasingly relied on coal & new coal burning plants to power this manufacturing.
That has produced incredibly bad air pollution in China itself. Some of that air pollution is even making it across the Pacific to the United States. AND it has made China one of the biggest sources of CO2 on the planet. They are or shortly will be the country that generates the most CO2 each year in all the world.
That means that the people in China now have a lower quality of life and poorer health than they would if this energy could be produced without burning coal as they have been.
And, it means that we CANNOT solve CO2 driven global warming without China switching to cleaner energy sources that do not release CO2.
So, how can China use less coal? And, what can the United States & other developed countries do to make that happen better & faster?
Here are some thoughts.
1. It would DEFINITELY help if we dramatically reduced the coal WE burn for energy in the United States. China will be much more likely to do this also if we walk the talk. Further, the technology & practices we use to do this can be shared with China.
Similarly, it would help if we only allowed coal to be burned for energy if & ONLY IF absolutely all pollutants generated by burning the coal were removed from the air AND as fast as we learn how & get the equipment installed we sequester all of the CO2 generated.
If that was phased in over 10 years at existing coal burning facilities & no new coal burning plants were built, that would help solve global warming; it would gradually make coal generated electricity more expensive; & it would improve the competitiveness of nuclear, solar, & wind generated electricity which will help develop new technologies and increase our electricity generated from cleaner sources than coal.
2. Similarly, it would help if we did everything we could to pass on information to China on rolling out solar and wind power generation. This could range from licensing technology at discounted rates to export incentives to solar and wind power companies to export their products to China.
It helps that China is already developing its own solar companies.
3. Since China is already a member of the so called “nuclear club” in the world it also might make sense to work with them to build more nuclear plants to generate electricity in exchange for asking for commitments to high levels of safety, security, and safe disposal & storage.
4. Only after we do all three of these things do I think we should put any kind of diplomatic pressure on China to reduce the amount of coal they burn or place a tax or tariff on their manufactured products that are sent to this country to compensate for the costs of global warming if they don’t.
That may make good sense later if it is still necessary. But I think making a massive push to make these changes here & do everything we can to speed our own move away from coal and to help them in ways they will find useful and effective is much better.
This will do three things. It will give them some of the tools & some momentum in the right direction first. And, it will allow them to see our pressure at that point as coming from a friend rather than an enemy if we still need to exert it. And, of greatest importance, we will then be doing the right things ourselves instead of asking them to do so when we haven’t bothered to do them here.
5. A related thought occurs to me. With its lower cost of manufacturing, it might make sense to help China become a major manufacturer of LED light bulbs for home & small business lighting world wide. One of the barriers to rapid deployment of this energy saving technology is the high cost of such bulbs now. Why not help put China in a position to contribute world wide to solving this problem?
An important benefit of this would also be to help China use far less electricity for lighting itself -- which would also help them stop building new coal burning plants to generate electricity.
Wednesday, May 7, 2008
Good news on LED lighting....
Today’s post: Weds, 5-7-2008
According to an article in today’s San Jose Mercury News in their business section, venture capitalists are beginning to put a LOT more money into funding LED light companies. In just the first 3 months of 2008, they invested $100 million. That compares to $13 million in 2005, 88 in 2006 & 91 in 2007.
One of the more interesting companies mentioned in the article today was Bridgelux Inc in Sunnyvale, CA.
They were listed as intending some of their LED lights to be used in homes – not just in traffic lights or backlighting on electronic devices, etc.
I phoned Brian Fisher, their media contact, who said that they do anticipate that some of their customers will make Bridgelux’s LED light products into light bulbs. It seems that companies like Bridgelux Inc do for lighting manufacturers what semiconductor companies like Intel do for PC makers. They make the components instead of the devices used by end users.
However, he said that a replacement using their LED’s for a 75 watt incandescent light bulb that generates 1100 lumens of light would use 10 watts.
Compact fluorescents generating that amount of light would use more like 18 to 20 watts & LED lights from other companies are reported to be in the 11 to 12 watt range for that much light.
Since Bridgelux Inc may also be able to make their LED products for less than other companies – according to their website -- it’s easy to see why they have raised over $70 million in venture capital including $40 million last month.
The other thing he said I did not know before is that LED lights are both more rugged in use than other lights & can do better in really cold places such as inside freezers or in facilities that are not heated in extremely cold climates.
(If you want to check out this company, their website is: http://www.bridgelux.com/ )
The article also listed four other LED lighting companies. Three others are in the Silicon Valley & one in Massachusetts has a Silicon Valley based venture capital investor.
The other encouraging news is that the article reports that WalMart is already making substantial use of LED lighting for its stores.
Since WalMart is profitable & has lower prices, they often pioneer effective cost saving methods. So, as this news gets out, other stores may well begin using LED lights as well.
And, it’s also clear that once LED light bulbs are widely sold & begin to come down in price, WalMart will sell the less expensive ones in large volume.
My take on all this is that LED light bulbs for the home are about where personal computers were just before the Apple II came out.
Some company will do it well enough that customers will buy; get extremely good & world wide publicity; & the explosion in LED light bulbs will then follow over the next 15 to 20 years after that.
My hope is that once LED light bulbs are widely available & that fit existing light sockets we will see gradually & then rapidly increasing carbon taxes on incandescent bulbs until they cost as much as the LED light bulbs which will gradually cost less over that same time period.
And, once that happens, I hope that compact fluorescent light bulbs that contain mercury are banned.
We will then have a market where a small amount of incandescent lights are still made & used for special situations, particularly those where the heat they generate is valuable. We will have no compact fluorescent light bulbs or we will have compact fluorescent light bulbs that contain no mercury in some applications. But 95 % of all light bulbs will be LED lights.
What I’d like to see soon is a company that already makes light bulbs for home use, develop LED bulb replacements for 60, 75, & 100 watt incandescent light bulbs that fit the sockets & lighting fixtures incandescent light bulbs have been used in until now along with a way for customers &/or utility companies to finance the people who buy them.
GE can do that & may do that at some point. But so far, such innovation has usually been done by venture backed startups. For example, Hewlett Packard passed on the idea of building a personal computer until Apple pioneered the idea & IBM and other companies jumped in.
That’s the company I’m waiting to see & hope to see within the next two or three years.
If any of the readers of this blog discover one, please let me know as a comment on this post on another post on this blog.
Today’s post: Weds, 5-7-2008
According to an article in today’s San Jose Mercury News in their business section, venture capitalists are beginning to put a LOT more money into funding LED light companies. In just the first 3 months of 2008, they invested $100 million. That compares to $13 million in 2005, 88 in 2006 & 91 in 2007.
One of the more interesting companies mentioned in the article today was Bridgelux Inc in Sunnyvale, CA.
They were listed as intending some of their LED lights to be used in homes – not just in traffic lights or backlighting on electronic devices, etc.
I phoned Brian Fisher, their media contact, who said that they do anticipate that some of their customers will make Bridgelux’s LED light products into light bulbs. It seems that companies like Bridgelux Inc do for lighting manufacturers what semiconductor companies like Intel do for PC makers. They make the components instead of the devices used by end users.
However, he said that a replacement using their LED’s for a 75 watt incandescent light bulb that generates 1100 lumens of light would use 10 watts.
Compact fluorescents generating that amount of light would use more like 18 to 20 watts & LED lights from other companies are reported to be in the 11 to 12 watt range for that much light.
Since Bridgelux Inc may also be able to make their LED products for less than other companies – according to their website -- it’s easy to see why they have raised over $70 million in venture capital including $40 million last month.
The other thing he said I did not know before is that LED lights are both more rugged in use than other lights & can do better in really cold places such as inside freezers or in facilities that are not heated in extremely cold climates.
(If you want to check out this company, their website is: http://www.bridgelux.com/ )
The article also listed four other LED lighting companies. Three others are in the Silicon Valley & one in Massachusetts has a Silicon Valley based venture capital investor.
The other encouraging news is that the article reports that WalMart is already making substantial use of LED lighting for its stores.
Since WalMart is profitable & has lower prices, they often pioneer effective cost saving methods. So, as this news gets out, other stores may well begin using LED lights as well.
And, it’s also clear that once LED light bulbs are widely sold & begin to come down in price, WalMart will sell the less expensive ones in large volume.
My take on all this is that LED light bulbs for the home are about where personal computers were just before the Apple II came out.
Some company will do it well enough that customers will buy; get extremely good & world wide publicity; & the explosion in LED light bulbs will then follow over the next 15 to 20 years after that.
My hope is that once LED light bulbs are widely available & that fit existing light sockets we will see gradually & then rapidly increasing carbon taxes on incandescent bulbs until they cost as much as the LED light bulbs which will gradually cost less over that same time period.
And, once that happens, I hope that compact fluorescent light bulbs that contain mercury are banned.
We will then have a market where a small amount of incandescent lights are still made & used for special situations, particularly those where the heat they generate is valuable. We will have no compact fluorescent light bulbs or we will have compact fluorescent light bulbs that contain no mercury in some applications. But 95 % of all light bulbs will be LED lights.
What I’d like to see soon is a company that already makes light bulbs for home use, develop LED bulb replacements for 60, 75, & 100 watt incandescent light bulbs that fit the sockets & lighting fixtures incandescent light bulbs have been used in until now along with a way for customers &/or utility companies to finance the people who buy them.
GE can do that & may do that at some point. But so far, such innovation has usually been done by venture backed startups. For example, Hewlett Packard passed on the idea of building a personal computer until Apple pioneered the idea & IBM and other companies jumped in.
That’s the company I’m waiting to see & hope to see within the next two or three years.
If any of the readers of this blog discover one, please let me know as a comment on this post on another post on this blog.
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