Posts tagged ‘gas’

The Continuing Climate Disconnect and the Climate Bait and Switch

I am at an impasse.  Here is my dilemma:  I don't know if the media is purposely obfuscating the climate debate or whether they are just ignorant and scientifically illiterate.  For now, because I am a happy soul that does not like making dark assumptions about other people's motivations, so I am going to give the media the benefit of the doubt and just assume they are ignorant.  But it is getting harder to reach this conclusion, because for it to be ignorance, it has to be serial ignorance lasting many years and crossing thousands of people.

The other day, in response to an article at Skeptical Science, I wrote about the typical media myths in the climate debate that make actual conversation about the theory so difficult.  The first one I listed was this:

  • "Climate deniers are anti-science morons and liars because they deny the obvious truth of warming from greenhouse gasses like CO2"

In fact, if you read the article, most of the prominent climate skeptics (plus me, as a non-prominent one) totally accept greenhouse gas theory and that CO2, acting alone, would warm the Earth by 1-1.2C.  What we are skeptical of is the very net high positive feedbacks (and believe me, for those of you not familiar with dynamic systems analysis, these numbers are very large for stable natural systems) assumed to multiply this initial warming many-fold.

This is just tremendously frustrating, in part because climate alarmists (at least in the media) don't seem to understand their own theory.  I constantly have to patiently explain that the theory of catastrophic man-made global warming (or climate change if you prefer) is a two part theory, and that warming forecasts are based on two independent chained theories:  First, CO2 acting as a green house gas incrementally warms the earth and second, large net positive feedbacks in the Earth's climate multiply this initial warming many times.  The majority of the warming actually comes from the second theory, not greenhouse gas theory, but every time I am in a debate or interview situation one of the early questions is "how can you deny greenhouse gas theory, it is settled science?"   This is what I call the climate bait and switch -- skeptics have issues with the second theory but the media and climate alarmists only want to argue about the first.

Robert Tracinski at the Federalist highlights a really good example of this:

In a CNBC interview, the host asked, “Do you believe that it’s been proven that CO2 is the primary control knob for climate?” Pruitt answered: “No, I think that measuring with precision human activity on the climate is something very challenging to do, and there’s tremendous disagreement about the degree of impact. So no, I would not agree that it’s a primary contributor to the global warming that we see. But we don’t know that yet. We need to continue the debate and continue the review and the analysis.”

This is a pretty reasonable answer.  It is simply absurd to argue that CO2 (at a current atmospheric concentration of 0.04%) is the "primary control knob for climate".  CO2 is obviously part of a large and complex equation with many, many variables, but calling it the primary control knob is like saying that the sugar industry is the primary control knob for the US economy.

But back to the issue of the climate bait and switch.  Here is NPR responding to Pruitt's comments.  Can you guess what they say?

Those statements are at odds with an overwhelming body of scientific evidence showing that humans are causing the climate to warm by releasing CO2 into the atmosphere. The view that CO2 is a major heat-trapping gas is supported by reams of data, included data collected by government agencies such as NASA and the National Oceanic and Atmospheric Administration.

Greenhouse gas theory is settled science!  But Pruitt has never, in anything I have read, disagreed with greenhouse gas theory.  He just thinks the effects have been exaggerated.  But here is the media, yet again, ignoring the actual arguments of skeptics and trying to recast their position as denying greenhouse gas theory.  The media sets up this false dichotomy that either you accept that CO2 is "the primary control knob of climate" or you deny CO2 is a greenhouse gas at all.  They allow no intermediate position, despite the fact that both of these choices are scientifically absurd.

Mr. Tracinski goes on to make the same point I often make, so I will let him do it in his own words since I don't seem to have any success explaining it:

The question is not whether carbon dioxide is a greenhouse gas. The question is whether it is the “primary control knob for the climate.” The question is whether it is the greenhouse gas, the one factor that dominates all other factors.

There is good reason for skepticism. For one thing, just on the “basic science,” Pruitt is absolutely correct. Carbon dioxide is a greenhouse gas, but it is not the most powerful greenhouse gas, by a long shot. Water vapor is far more effective at trapping heat and releasing it back to the atmosphere, primarily because it absorbs a lot more radiation in the infrared spectrum, which is released as heat.

That’s why all of the climate theories that project runaway global warming use water vapor to juice up the relatively small impact of carbon dioxide itself. They posit a “feedback loop” in which carbon dioxide increases temperatures, which increases the amount of water vapor in the atmosphere, which increases temperatures even more. These models need a more powerful greenhouse gas to magnify the effect of carbon dioxide.

But does it really work that way? By how much does water vapor magnify the impact of carbon dioxide? And is that effect dampened by other factors? Consider cloud formation: more water in the atmosphere means more clouds, which reflect sunlight back into space and have a cooling effect that counteracts the warming effect. But by how much?

The answer is that nobody really knows. There are varying estimates for “climate sensitivity,” that is, how sensitive global temperatures are to increases in carbon dioxide. They range from a relatively trivial impact—less than one degree Celsius warming from a doubling of atmospheric carbon dioxide—to more than five degrees.



I Was Right About the December Surprise, But For the Wrong Reasons

I have observed in the past that the media will run negative pieces about legislation they favor, but only after the legislation is passed and the information is not longer useful to the debate.  I suppose they do this to retroactively create a paper trail for being even-handed.  So I hypothesized that we might see a December surprise once Hillary won, raising issues about her more forthrightly than they were willing to before the election.

Well, I was sortof right.  We are seeing a December surprise -- the silly Russian hacking story being pushed by the Clinton campaign and the White House -- but for completely different reasons.   These stories are clearly to try to de-legitimize Trump's election, either just as general battle-space preparation or more specifically ahead of the Electoral College vote.

By the way, speaking of fake news, it strikes me there is an interesting bait and switch in how this story is presented.  The story itself is about the appropriation and publication of the emails of Democratic insiders.  To my knowledge, no one has claimed the emails have been altered or faked, so one could argue that most of the damage is self-inflicted on Democrats -- if they had not been writing about inciting violence at Trump rallies, there would be nothing salacious to leak.

But the media shorthands all this as just "hacking" which I suspect many low information voters think refers to actually altering vote tabulations.  Certainly this is the assumption that Jill Stein and all the suckers who donated to her money-hole recount effort ran with.  But of course there is zero evidence of this and it is almost impossible to imagine happening in any kind of wholesale manner.  But I think that some in the media and many in the Democrat camp are purposely throwing around the "hacking" term in the hopes that people will get this false impression.

Postscript:  I have a new standard we should apply to any government regulatory effort aimed at a private company selling a product or service thought to be fraudulent:  No private individual can be prosecuted for selling any product or service that is less of a scam than Jill Stein's recount eff0rt (which, oh wait, may get spent on something else, anything else they want).   Ordinary people are being suckered into giving money to this on completely false, really absurd, principles.  It infuriates me when politicians get all pious about, say, Exxon misleading the public about global warming when they sell crap like this.  At least when I pay my $3 to Exxon, I get a gallon of gas that actually runs my car as promised.  What will any of these donors get from Stein's effort?

I Owe An Apology to My Fellow Skeptics -- Apparently I Underestimated How Stupid the California Legislature Can Be

There was a period of time -- now a decade ago at least -- when folks were actually willing to have debates on climate and I was invited to participate in a number of them.  In several of these, fellow skeptics would try to mock alarmists by saying that cow farts are a big source of methane (a much stronger greenhouse gas than CO2) and thus alarmists were going to be regulating cow farts soon.  On several time, I criticized my fellow skeptics, calling this both a conspiracy theory and a distraction from the real debate -- once someone says "cow farts" in a discussion, it is almost a lock that you will have a hard time getting back to serious science.

Well, I was wrong.  I am sorry to all those skeptics I derided for pushing the cow fart meme.  Because the California legislature did passed a law to regulate cow farts.

Well, sort of.  In fact, even the California legislature is not really stupid enough to require that long vent hoses be hooked up to the rear ends of all the cows in the state.  While you will hear this law derided as the cow fart legislation, it actually about cow poop -- specifically the collection of all the cow poop so it can be put into devices that contain and harvest the methane emissions from the poop.

What this is far more likely to be is not the cow fart or cow poop legislation, but the "send California's dairy business to other states" legislation.

Being A Victim Apparently Has More Status Now Than Being A Gold Medal Winner -- Ryan Lochte Channels "Jackie"

There appears to be no rational way to explain Ryan Lochte's bizarre need to make up a story about being the victim of an armed robbery.  The media seems to be pushing the notion that he made up the story to cover up his own vandalism at a gas station, but that makes zero sense.  He had already defused the vandalism incident with a payment of cash to the station owner.  The rational response would be to just shut up about the whole thing and let it be forgotten.

But instead, he purposely made a big deal about the incident, switching around the facts until he was a victim of an armed assault by men posing as police officers, up to and including harrowing details of a cocked gun being jammed into his forehead.  The incident, likely ignored otherwise, suddenly became a BIG DEAL and subsequent investigation (including multiple video sources) showed Lochte to be a bald-faced liar.

The only way I can explain Lochte's motivation is to equate it with the lies by "Jackie" at the University of Virginia, whose claims of being gang-raped as published in the Rolling Stone turned out to be total fabrications.  Like Lochte, she dressed up the story with horrifying details, such as being thrown down and raped on a floor covered in broken glass.  The only real difference I can see, in fact, between Lochte and Jackie  is that the media still protects Jackie (via anonymity) from well-deserved humiliation for her lies while it is piling on Lochte.

I can sort of understand Jackie's motivation -- she was by all accounts a frustrated, perhaps disturbed, certainly lonely young woman who was likely looking for some way to dramatically change her life.  But Lochte?  Ryan Lochte has won multiple Olympic medals, historically in the sports world a marker of the highest possible status.  But in today's world, Lochte viewed victimhood as even higher status.

Update:  This is probably the fairest account of the whole incident.

Fracking and Foreign Policy

I am happy to see prominent members of Congress from both parties starting to question our support of the deeply flawed government in Saudi Arabia.  I don't want to make war on them (repeating the Lybia mistake) but I also have been leery for quite a while about supporting a country that funds so much terrorism and is frankly as socially backwards as any place in the world.

So here is my question:  Had it not been for the shale oil and gas revolution in this country, would the US Congress be willing to question this relationship today?

Contact Lenses and Cronyism

Hooray for Veronica de Rugy, who is criticizing prescription requirements for contact lenses.

What makes the contact lens market unique — and also leaves it extra vulnerable to crony intervention — is the fact that customers are required by federal law to obtain a prescription from a licensed optometrist in order to purchase lenses.

It is a rare instance where prescribers are also sellers, which leads to a cozy relationship between manufacturers and the doctors who can steer patients toward their brand.

Prescriptions are brand-specific, which makes it difficult for consumers to shop around. Choosing a different brand would require paying for another exam in order to obtain a new prescription.

The simplest solution would be to do away with the gatekeepers altogether and allow the purchase of contact lenses without a prescription.

It works just fine that way in Europe and Japan

I feel like I have been the lone voice in the wilderness on this one, writing about my frustration with contact lens prescription requirements way back in 2007:

I drive into my local Shell station to fill up, and stick my card in the pump, but the pump refuses to dispense.  I walk into the office and ask the store manager why I can't get gasoline.  She checks my account, and says "Mr. Meyer, your Volvo fuel prescription has expired."  I say, "Oh, well its OK, I am sure I am using the right gas."  She replies, "I'm sorry, but the law requires that you have to have a valid prescription from your dealership to refill your gas.  You can't make that determination yourself, and most car dealerships have their prescriptions expire each year to make sure you bring the car in for a checkup.  Regular checkups are important to the health of your car.  You will need to pay for a service visit to your dealership before we can sell you gas."  I reply, "RRRRRRR."

OK, so if this really happened we would all scream SCAM!  While we all recognize that it may be important to get our car checked out every once in a while, most of us would see this for what it was:  A government regulation intended mainly to increase the business of my Volvo dealership's service department by forcing me to pay for regular visits.

So why don't we cry foul when the exact same situation occurs every day with glasses and contact lenses?

The Science is Settled!

“Scientists have solid experimental and theoretical evidence to support…the following predictions: In a decade, urban dwellers will have to wear gas masks to survive air pollution…by 1985 air pollution will have reduced the amount of sunlight reaching earth by one half….”
• Life Magazine, January 1970

Other prediction fails from the first Earth Day here.

Great Moments in US Energy Policy: In the 1970's, The US Government Mandated Coal Use For New Power Plants

What does government energy policy have in common with government food advice?  Every 30-40 years the Federal government reverses itself 180 degrees and declares all the stuff that they said was bad before is now good today.

Case in point:  Coal-fired electrical generation.  Coal is pretty much the bette noir of environmentalists today, so much so that Obama actually pledged to kill the coal industry when he was running for office.   The combination of new regulation combined with the rapid expansion of cheap natural gas supplies has done much to kill coal use (as illustrated by this bankruptcy today).

But many people may not realize that the rise of coal burning in power plants in the US was not just driven by economics -- it was mandated by government policy

Federal policies moved in coal's favor in the 1970s. With the Middle East oil crisis, policymakers began to adopt policies to try and shift the nation toward greater coal consumption, which was a domestic energy resource. The Energy Supply and Environmental Coordination Act of 1974 directed the Federal Energy Administration to prohibit the use of oil or natural gas by electric utilities that could use coal, and it authorized the FEA to require that new electric power plants be able to use coal. The Energy Policy and Conservation Act of 1975 extended those powers for two years and authorized $750 million in loan guarantees for new underground low-sulfur mines. Further pro-coal mandates were passed in the late-1970s.

I was aware of the regulations at the time as I was working in an oil refinery in the early 80's and it affected us a couple of ways.  First, it killed demand for low-sulphur heavy fuel oil.  And second, it sidelined several co-generation projects that made a ton of sense (generating electricity and steam from wasted or low-value portions of the oil barrel) but ran afoul of these coal mandates.

Does Anyone Actually Like Having a Washroom Attendant?

It's a serious question.  I hate walking into a bathroom and seeing an attendant.  Do I really want someone hovering over me when I am doing my business or washing my hands?  In a world where I am happy to pump my own gas, do I need someone squirting soap on my hands and handing me a towel?  All of which is transparently a bid to guilt me into tipping them for a service I never wanted -- in fact, a service that is a big negative for me.  I find myself actively avoiding restaurants I know to have attendants in the bathrooms.

Perhaps being an introvert I have stronger feelings on this, but if other people share these same feelings, even if less strongly, why the hell are there bathroom attendants in the first place?  Are they make-work jobs for some out-of-luck relative of the restaurant owner?  Or maybe for the local mafia protection racket?

A Keystone Hack

Well, we have reached another milestone in our permission-based economy with the Administration's rejection of the Keystone Pipeline.  We have zillions of miles of pipelines and are actually wasting energy and creating environmental messes moving the same oil by the inferior option of rail, but somehow this one pipeline had to be opposed.

Actually, the only reason this project is in front of the administration at all is because it crosses the Canadian border, which requires  State Department sign-off.  Which leads me to wonder if there is a hack.  Why not take the pipeline right up to the border from both sides and create a rail line across the border using a continuous loop of tank cars.  Its kludgy and inefficient, but probably less so than moving the oil long distance by rail.

I am reminded of this from a story long ago off Santa Barbara.  Exxon had gotten permission to drill in Federal waters, but local state/county folks wanted to find a way to stop the oil development.  Plans were (as is typical for any offshore oil) for a separation facility on shore that would separate oil, gas, and water from the mix that usually comes up out of the ground.    The state or local folks (can't remember which) refused to permit the separation facility, thinking that would kill the project.  But Exxon built what I believe was a unique separation facility on a boat and anchored the boat offshore.  No land permits necessary.

This is very similar, in my mind, to the pipeline decision.  California's attempt to block oil development altogether proved futile, just as Obama's decision will have little effect on long-term Canadian oil development.  But it did, in both cases, force a workaround (rail and the separator ship) that were almost certainly environmentally worse solutions than those that were halted.

The Wrong Way to Sell Wind and Solar

A reader sent me this article on renewables by Tom Randall at Bloomberg.  I would like to spend more time thinking about it, but here are a few thoughts. [Ed:  sorry, totally forgot the link. duh.]

First, I would be thrilled if things like wind and solar can actually become cheaper, without government subsidies, than current fossil fuels.  I have high hopes for solar and am skeptical about wind, but leave that aside.

Second, I think he is selling renewables the wrong way, and is in fact trumpeting something as a good thing that really is not so good.  His argument is that the decline in capacity factors for natural gas and coal plants is a sign of the success of renwables.  The whole situation is complex, and a real analysis would require looking at the entire power system as a whole (which neither of us are doing).  But my worry is that all the author has done is to demonstrate a unaccounted-for cost of renewables, that is the reduction in efficiency of coal and natural gas plants without actually being able to replace them.

Here is his key chart.  It purports to show the total US capacity factor of each energy mode, with capacity factor defined as the total electricity output of the plant divided by what the electricity output could be if the plant ran full-out 24/7/365.

capacity factors

First, there is a problem with this chart in terms of its data selection -- one has to be careful looking at intra-year variations in capacity factor because they vary a lot seasonality, both due to weather and changes in relative fuel prices.  Also, one has to be hugely suspicious when someone is claiming a long term trend but only shows 18 months of data.   The EIA can provide some of the data for a few years ahead of his table.  You can see it is pretty volatile.


I won't dwell on the matter of data selection, because it is not the main point I want to make, but the author's chart looks suspiciously like cherry-picking endpoints.

The point I do want to make is that reducing the capacity utilization, and thus efficiency, is a COST not a benefit as he makes it out.  Things would be different if renewables replaced a lot of fossil fuel capacity at the peak utilization of the day (the total capacity of a power system has to be sized to the peak daily demand).  But the peak demand in most Western countries occurs late in the day, long after solar has stopped producing.  Germany, which relies the most on solar, has studied this and found their peak electricity demand is around 6PM, a time where solar provides essentially nothing.   Wind is a slightly different problem, because of its hour to hour unpredictability, but suffice it to say that it can't be counted on in advance on any particular day to provide power at the peak.

This means that one STILL has to have the exact same fossil fuel plant capacity as one did without renewables.  Yes, it runs less during the day and burns less fuel, but it still must be built and exist and be staffed and in many cases it still must be burning some fuel (even if producing zero electricity) to be hot and ready to go.

The author is arguing for a virtuous circle where reductions in capacity factors of fossil fuel plants from renewables increases the total cost per KwH of electricity from fossil fuels (because the capital cost is amortized over fewer kilowatts).  This is technically true, but it is not the way power companies have to look at it.  Power companies have got to build capacity to the peak.  With current technologies, that means fossil fuel capacity has to be built to the peak irregardless of their capacity factor.  If these plants have to be built anyway to cover for renewables when they disappear during the day, then the capital costs are irrelevant at the margin.   And the marginal cost of operations and producing power from these plants, since they have to continue to exist, is around $30-$40 a MwH, waaaay under renewables still.

In essence, the author is saying:  hurray for renwables!  We still have to have all the old fossil fuel plants but they run less efficiently now AND we have paid billions of dollars to duplicate their function with wind and solar plants.  We get to pay twice for every unit of electricity capacity.

Environmentalists are big on arguing that negative externalities need to be priced and added to the cost of things that generate them -- thus the logic for a carbon tax.  But doesn't that mean we should tax wind and solar, rather than subsidize them, to charge them for the inefficiently-run fossil fuel plants we have to keep around to fill in when renewables inevitably fail us at the peak time of the day?

By the way, speaking of subsidies, the author with a totally straight face argues that renewables are now cheaper than fossil fuels with this chart:

solar costs


He also says, "Wind power, including U.S. subsidies, became the cheapest electricity in the U.S. for the first time last year."

I hate to break it to the author, but a Ferrari would be cheaper than a Ford Taurus if the government subsidized it enough -- that means nothing economically other than the fact that the government is authoritarian enough to make it happen.  All his chart shows is that solar is more expensive than coal and gas in every state.

And what the hell are those units on the left?  Does Bloomberg not know how to annotate charts?  Since 6 cents per Kw/hr is a reasonable electricity cost, my guess is that this is dollars per Mw/hr, but it is irritating to have to guess.

No on Phoenix Prop 104: The Promised Benefits Are Almost Certainly Grossly Exaggerated

A reader sent me this:  A recent McKinsey study looked at large infrastructure projects (over $1 billion).  In the introduction they observe:

Rail projects, for example, go over budget by an average of 44.7 percent, and their demand is overestimated by 51.4 percent.

We actually can combine these two numbers and find that the total cost per user of these systems was over-estimated by 117%, meaning the cost per user was on averagemore than double what was promised when these projects are sold to the taxpayers.

At the end of the day, the first segment of the line cost $75,000 per round trip daily raider.  We could have bought every regular rider a prius and a lifetime of gas and still saved money.

Vote "NO!" on Phoenix Prop 104 Transit Tax

Randal O'Toole and the Arizona Free Enterprise Club have weighed in with a comprehensive report on Phoenix's Prop 104 transit tax, and the results are ugly.  A few findings:

  • The oft-repeated claim that light rail has generated $7 Billion dollars in economic development is simply untrue. In fact, many of the projects included in this claim have never been built (like the Sycamore Station development) or involve projects that have nothing to do with light rail (such as the $600 million Convention Center Expansion, which was funded largely by state tax dollars).
  • The main beneficiaries of the transit plan appear to be contractors and developers who have projects near rail stations. The tax revenue from the plan combined with the generous subsidies offered to select developments ensures that this plan will benefit a few contractors and developers at the expense of others.
  • The plan is unbalanced and ignores vehicle street improvements. Despite the fact that only 3% of the population uses transit (less than 1% use light rail), 95% of the funding in the plan goes toward expanded bus and rail service. Only 3% goes toward vehicle street improvements.
  • Transit ridership actually fell after the light rail opened. From when light rail opened in 2009 through 2014, any gains in light rail ridership were offset by the loss of more than one bus rider. Ridership is still 1.2 million less per year than it was in 2009.
  • The transit plan as proposed will increase traffic congestion, energy usage and greenhouse gas emissions. In fact, the transit plan will use more

The complete report is here.

Coyoteblog readers will be totally familiar with this statement from the report about light rail merely cannibalizing bus riders, echoing past articles I have had saying the same thing:

According to the city of Phoenix and Valley Metro, light rail is a great success in Phoenix, generating a 42-percent increase in transit ridership since 2001 and stimulating the construction of $7 billion in new real estate development along its route. A close look, however, reveals that both of these claims are wrong.

The increase in ridership took place between 2001 and 2009, the (fiscal) year that the light-rail line opened. Since that year, for every light-rail rider gained, the region’s transit systems lost more than one bus rider. Per capita transit ridership has declined by 8 percent since 2009 partly because the high cost of light rail forced a 34-percent increase in average bus fares by 2010 and an 18-percent decrease in bus service by 2013.

You can see this perfectly well from a chart right off of our transit authority's web site (except for my annotation in red), which I discussed in depth here.

click to enlarge

It is just incredibly disingenuous that light rail supporters are trying to claim credit for transit ridership increases that occurred before the line was built and whose growth the line essentially halted.

Another claim the report demolishes is that light rail is somehow spurring development.  Supporters claim $7 billion of light rail development planned or built along the line, but oddly enough that is the exact same figure they were touting almost 8 years ago before the line was even completed.  Doesn't seem like they are getting much traction, huh?  In fact, the list actually shortens with every year as projects get cancelled and no new ones are added.  But beyond this, simply adding up development along the line and claiming that it is all incremental to the line's construction is simply moronic, the same facile BS analysis often used to support publicly funded football stadiums.    The obvious questions are:

  • How do they know this development is incremental, and not development that would have occurred anyway?  In particular, this line was built through the three of the largest pre-existing development hubs in the metropolitan area (North Central Ave, Downtown Phoenix, and Tempe/ASU).  There was always development activity in these areas, and always going to be
  • Much of the new activity they cite is near Tempe Town Lake, and I would give that project, not the rail, much of the credit.  The city did a marvelous job (see, I can give props to government once in a while) converting a big wide ugly dry ditch into a lake that is the centerpiece for business and condo development
  • Much of this development is subsidized by various government programs.  It is impossible to separate the effects of the subsidy from the rail line.

Finally, if you don't believe me about the relative costs of the two modes, let's take a look at the number from Phoenix's own plan.  They speak for themselves:


So what does one get for the 5x higher operating costs and 134x higher capital costs of light rail over buses?  Well on the negative side, one gets a system that is substantially less flexible and responsive to changes.  The only positive I can come up with is that middle and upper class white people consider buses low class and want a transportation mode of their own.

A Great Example of How the Media Twists Facts on Climate

First, let's start with the Guardian headline:

Exxon knew of climate change in 1981, email says – but it funded deniers for 27 more years

So now let's look at the email, in full, which is the sole source for the Guardian headline.  I challenge you, no matter how much you squint, to find a basis for the Guardian's statement.  Basically the email says that Exxon knew of the concern about global warming in 1981, but did not necessarily agree with it.  Hardly the tobacco-lawyer cover-up the Guardian is trying to make it sound like.  I will reprint the email in full because I actually think it is a pretty sober view of how good corporations think about these issues, and it accurately reflects the Exxon I knew from 3 years as a mechanical / safety engineer in a refinery.

I will add that you can see the media denial that a lukewarmer position even exists (which I complained about most recently here) in full action in this Guardian article.  Exxon's position as described in the Guardian's source looks pretty close to the lukewarmer position to me -- that man made global warming exists but is being exaggerated.   But to the Guardian, and many others, there is only full-blown acceptance of the most absurd exaggerated climate change forecasts or you are a denier.  Anyway, here is the email in full:

Corporations are interested in environmental impacts only to the extent that they affect profits, either current or future. They may take what appears to be altruistic positions to improve their public image, but the assumption underlying those actions is that they will increase future profits. ExxonMobil is an interesting case in point.

Exxon first got interested in climate change in 1981 because it was seeking to develop the Natuna gas field off Indonesia. This is an immense reserve of natural gas, but it is 70% CO2. That CO2 would have to be separated to make the natural gas usable. Natural gas often contains CO2 and the technology for removing CO2 is well known. In 1981 (and now) the usual practice was to vent the CO2 to the atmosphere. When I first learned about the project in 1989, the projections were that if Natuna were developed and its CO2 vented to the atmosphere, it would be the largest point source of CO2 in the world and account for about 1% of projected global CO2 emissions. I’m sure that it would still be the largest point source of CO2, but since CO2 emissions have grown faster than projected in 1989, it would probably account for a smaller fraction of global CO2 emissions.

The alternative to venting CO2 to the atmosphere is to inject it into ground. This technology was also well known, since the oil industry had been injecting limited quantities of CO2 to enhance oil recovery. There were many questions about whether the CO2 would remain in the ground, some of which have been answered by Statoil’s now almost 20 years of experience injecting CO2 in the North Sea. Statoil did this because the Norwegian government placed a tax on vented CO2. It was cheaper for Statoil to inject CO2 than pay the tax. Of course, Statoil has touted how much CO2 it has prevented from being emitted.

In the 1980s, Exxon needed to understand the potential for concerns about climate change to lead to regulation that would affect Natuna and other potential projects. They were well ahead of the rest of industry in this awareness. Other companies, such as Mobil, only became aware of the issue in 1988, when it first became a political issue. Natural resource companies – oil, coal, minerals – have to make investments that have lifetimes of 50-100 years. Whatever their public stance, internally they make very careful assessments of the potential for regulation, including the scientific basis for those regulations. Exxon NEVER denied the potential for humans to impact the climate system. It did question – legitimately, in my opinion – the validity of some of the science.

Political battles need to personify the enemy. This is why liberals spend so much time vilifying the Koch brothers – who are hardly the only big money supporters of conservative ideas. In climate change, the first villain was a man named Donald Pearlman, who was a lobbyist for Saudi Arabia and Kuwait. (In another life, he was instrumental in getting the U.S. Holocaust Museum funded and built.) Pearlman’s usefulness as a villain ended when he died of lung cancer – he was a heavy smoker to the end.

Then the villain was the Global Climate Coalition (GCC), a trade organization of energy producers and large energy users. I was involved in GCC for a while, unsuccessfully trying to get them to recognize scientific reality. (That effort got me on to the front page of the New York Times, but that’s another story.) Environmental group pressure was successful in putting GCC out of business, but they also lost their villain. They needed one which wouldn’t die and wouldn’t go out of business. Exxon, and after its merger with Mobil ExxonMobil, fit the bill, especially under its former CEO, Lee Raymond, who was vocally opposed to climate change regulation. ExxonMobil’s current CEO, Rex Tillerson, has taken a much softer line, but ExxonMobil has not lost its position as the personification of corporate, and especially climate change, evil. It is the only company mentioned in Alyssa’s e-mail, even though, in my opinion, it is far more ethical that many other large corporations.

Having spent twenty years working for Exxon and ten working for Mobil, I know that much of that ethical behavior comes from a business calculation that it is cheaper in the long run to be ethical than unethical. Safety is the clearest example of this. ExxonMobil knows all too well the cost of poor safety practices. The Exxon Valdez is the most public, but far from the only, example of the high cost of unsafe operations. The value of good environmental practices are more subtle, but a facility that does a good job of controlling emission and waste is a well run facility, that is probably maximizing profit. All major companies will tell you that they are trying to minimize their internal CO2 emissions. Mostly, they are doing this by improving energy efficiency and reducing cost. The same is true for internal recycling, again a practice most companies follow. Its just good engineering.

Materials I Use to Teach My 90-Minute Economic Class

I teach one 90-minute class a year in the senior economics elective at my kids' high school.  The teacher gives me a pretty free ability to cover whatever I wish.

Rather than trying to cover some school of thought, I instead focus the class on the seen and unseen (starting with quotes from Bastiat and Hazlitt).  We have about 12 economic problems, where we start with the seen, and then introduce the unseen.  We start with the classic broken window as the first one.

I teach the class with role play.  I give every student a couple of business cards with their role typed on them.  When I call on them I have them advocate for their role.  I have started to give a small food reward at the end of class to the student who best gets into character -- this has helped the role play immensely.   Let's take one example I do towards the end of the class involving price gouging after a hurricane.

We begin with the governor of Florida who has just signed an anti-price-gouging law.  We talk about how everyone hates price-gouging after a disaster.  What could be worse, right?

We then talk about a woman who spends most of her time at home, but rushes out to fill her gas tank right after the storm hits.  She has to wait in line for gas for 2 hours because everyone else has done the same as she, racing to the station, but she doesn't mind because she doesn't have anything else to do and feels better.  If asked if she would have topped off her tank if the price jumped to $6 from $3, she says no way.

Then we have an owner of a roofing company enter the fray.  His men are working 14 hours a day to put roofs on houses.  He is making a lot of money, and doing a lot of good as well.  Nothing is more important to people than fixing the roof before the next rain.  He may be the most important man in Florida at that moment.  But he can't keep up with demand, and worse, his guys are having to sit for 2 hours at a time to fill up their company trucks, when they should be repairing roofs.   He would gladly pay $10 a gallon if he could just keep his men on the job and not in gas stations.

So at this point we discuss "fairness".  It seems fair not to raise prices to "take advantage" of a disaster.  But is it fair to allocate gas away from the busiest and most productive whose time is most valuable to the people who are least productive and have the lowest value for their time?  We discuss how price caps shift rationing from price to queuing, and the people who get the product shift from those who most value it to those who assign the lowest value to their own time.

Finally, we discuss a guy in Georgia who has a tanker of gas he was going to send to a station in Atlanta.  They need the gas more in Florida, but they aren't paying more for it under the new price-gouging law, and so with his higher costs of driving all the way to Florida vs. Atlanta he is going to sell the gas in Atlanta.  If the price of gas in Florida were to rise to $6, he would send his truck of gas to Florida in a heartbeat.

This is the kind of discussion we have.   We will end up in a debate, with kids pointing out all kinds of things -- eg poor people who have a life or death need and might be shut out at $6.  We don't try to resolve things, but want them to understand there are unseen consequences to actions like price-gouging laws that must be considered along with the seen.  They may end up dismissing the unseen as less important than the seen, but it should not be ignored.

If anyone finds themselves in the same situation as me needing to teach a group (it could be adults as well) you are welcome to use my materials.  I actually print the business cards on Avery two-sided business card paper.  Attached are separate files for the front and back of cards as well as a sort of discussion key I use to guide the conversation.  We get into things, at least tangentially, like public choice theory and concentrated benefits / dispersed costs.

If you want to use the materials, you are welcome to email me with questions.  But these are all public domain so help yourself without permission.  (By the way, in trying to match the front to the back of each card in your mind, remember there is a mirroring effect, so the text on the right card on the backs in any given row goes with the front of the card on the left of the same row in the other file).

economics class discussion guide

economics class biz cards front

economics class biz cards back

New Business Opportunity: Lolo's Eagle and Waffles Next to Large Solar Plants

From ReWire via Anthony Watts

A test of a solar power tower project in Nevada resulted in injuries to over one hundred birds, the federal government is reporting, though the project's owners say they've fixed the problem.

On January 14, during tests of the 110-megawatt Crescent Dunes Solar Energy Project near Tonopah, Nevada, biologists observed 130 birds entering an area of concentrated solar energy and catching fire. That's according to Rudy Evenson, Deputy Chief of Communications for Nevada Bureau of Land Management in Reno.

Evenson suggested that the birds may have been attracted by a glow the concentrated solar energy created above the project's sole tower.


According to Evenson, workers testing the plant moved approximately a third of the project's ten thousand mirrors to focus sunlight on a point 1,200 feet above the ground, approximately twice the height of the power tower at Crescent Dunes.

The test started at 9:00 a.m. on January 14, Evenson told Rewire. By 10:30, biologists working on the site began noticing what have become known as "streamers," trails of smoke and water vapor caused by birds entering the field of concentrated solar energy (a.k.a. "solar flux") and igniting.

By the time the test ended for the day at 3:00 p.m., biologists had counted 130 such "streamers." A subsequent test on January 15 reduced the number of mirrors aimed at the focal point above the tower, said Evenson, and that apparently ended the injuries to birds.

Oops.  It is amazing how solar gets a pass on things that other industries would be hounded into bankruptcy over.  ExxonMobil was fined by the Feds for 85 bird deaths at the company's natural gas facilities.  These deaths were spread out over 5 states and over 5 years.  This solar plant killed at least 130 birds in one location in 6 hours.  ExxonMobil was fined $7000 per dead bird.  Anyone want to bet on what the solar guys will be fined?  Vegas has set the over-under at zero.

What Musicians and ExxonMobil Have in Common: Both Get "Ripped Off" By Consumers

We have all heard that artists make very little money from their songs, and get "ripped off"by record labels and other folks in the chain.  I have always had mixed reactions to this.  I have no doubt that, with zero power and a burning desire to "make it big", young acts sign uneven deals with record labels.  However, I find it hard to believe that Beyonce is getting hosed in that negotiation.

I saw this chart in TechDirt about where the money consumers spend on music goes (I think this is for a CD sale):


So the performers themselves get about 9% of the retail price after everyone in the chain is paid.  That certainly seems paltry -- after all, they are the owners and creators of the music.  Everyone else is just in the service chain to make sure the music reaches the customers, all the accounting is done, the legal documents are correct, etc.

But it turns out that they may not be doing that badly.  I am a shareholder of ExxonMobil (XOM).  I own a piece of all the oil that XOM owns and controls, along with all the other shareholders.  Think of us as the band, though a really big band with lots of players.   That oil we own, like the band's music, has a ton of value.  When sold as raw crude, it goes for $40-$60 a barrel nowadays.  When sold in pieces (such as gasoline, or asphalt, or lubrication oil) it can sell for hundreds of dollars a barrel.

But out of those proceeds, we have to pay people to help us.  We have to pay managers, and lawyers.  We have to pay oilfield services companies and equipment companies and transportation companies.  We have to pay retailers.  When all those payments are made, before taxes, in 2014 we were left with just under 8% of every dollar we sell.  We own all this oil and we are not even getting as much as a musician!

And XOM shareholders do pretty well.  Owners of Wal-Mart only get about 3% of every dollar they sell.   In my company, I get about 5% of every dollar I sell.   And those evil health insurers?  Their shareholders get just over 2% of every dollar sold (all based on 2014 full-year financials).

Does that mean that Exxon shareholders are getting "ripped off" by Haliburton and Burlington Northern?  Is Wal-Mart getting ripped off by Proctor and Gamble?  Is Humana getting ripped off by GE imaging?  No?

I will reveal the ugly secret:  There is one person who is "ripping off" all of these folks, from Exxon to Rihanna to me.  That person is.... the consumer.  Yep, there are certainly many examples of people signing bad contracts in all these businesses, but the only entity systematically and consistently ripping all these folks off is us.  Because in a capitalist economy, we have the ultimate power.  We drive down the street to get the gas that is 10 cents cheaper, we now shop for our books and TVs at Wal-Mart and Amazon rather than at Borders and Best Buy, and we buy 99-cent individual songs on iTunes instead of buying a whole CD of songs we don't want for $14.99.

Why Large Corporations Often Secretly Embrace Regulation

I wrote the other day about how Kevin Drum was confused at why broadband stocks might be rising in the wake of news that the government would regulate broadband companies as utilities.  I argued the reason was likely because investors know that such regulation blocks most innovation-based competition and tends to guarantee companies a minimum profit -- nothing to sneeze at in the Internet world where previous giants like AOL, Earthlink, and Mindspring are mostly toast.

James Taranto pointed today to an interesting Richard Eptstein quote along the same lines (though he was referring to hospitals under Obamacare):

Traditional public utility regulation applies to such services as gas, electric and water, which were supplied by natural monopolists. Left unregulated, they could charge excessive or discriminatory prices. The constitutional art of rate regulation sought to keep monopolists at competitive rates of return.

To control against the risk of confiscatory rates, the Supreme Court also required the state regulator to allow each firm to obtain a market rate of return on its invested capital, taking into account the inherent riskiness of the venture.

Want to Increase Infrastructure Money for Highways Immediately by 31%? Stop Diverting Highway Money to Transit

This DOT table, pointed out to me by Randal O'Toole, shows that money spent on highways could be increased immediately by over 30% if highway money was not diverted to transit and other uses.  About 13% of state gas tax revenues meant for highways are diverted to non-highway transit projects (e.g. light rail boondoggles).  Another 9.4% are diverted to general funds, and may not be applied to transportation projects at all.   The same table shows that if all state MVD receipts were used to support investments for cars rather than transit and general spending, money available for roads would increase 45% from those funds.

Transit projects should be supported by their own riders.  This will never happen, because they are so egregiously expensive per passenger-mile that no one would ride them if their trip were not subsidized by the rest of us**.  And I am exhausted with having folks argue that highways are "subsidized" because they require tax money beyond the gas taxes (which are essentially a user fee) when these extra tax monies for highways would be largely unneeded if the highway funds were used for highways.  The diversion to general funds is particularly troubling, since sleazy government officials are obviously trying to piggy-back off the popularity of highway infrastructure investment to generate a slush fund for activities taxpayers are less likely to support.

And please do not tell me that as a highway driver, investments in transit are doing me a favor by getting cars off the road.  Transit investments are so expensive per passenger mile that the same money spent getting a few cars off the road via transit would substantially increase road and highway capacities.  A dollar of highway investment carries at least an order of magnitude more passenger miles than a dollar of transit spending.

** I am always amazed that supporters of such transit projects call light rail projects "sustainable".  Forget for a minute that they seldom use less energy per passenger mile than driving.   Think about all the resources that go into them.  This at first seems like a hard problem -- how do we account for all the resources that go into transit vs. go into driving.  But then we realize it is actually easy, because we have a simple tool for valuing resource inputs:  price.  Prices are a great miracle.  They provide us with a sort of weighted average of the value and scarcity of the resources (both hard, like titanium, and soft, like labor and innovation) that go into a product.  So if light rail costs 10x or more per passenger mile than driving, as it often does, this means that it uses ten times the value of resource inputs as driving.  This is sustainable?  I do not think that word means what you think it means.

Great Moments in Bad Economic Policy

This article on bad bipartisan energy laws and regulations from Master Resource brought back some old memories of the 1970s.

Folks who are at all economically literate understand the role that government price controls (specifically price caps) had on gasoline shortages in the 1970s.  When there was a supply shock via the Arab oil embargo, prices were not allowed to rise to match supply and demand.  As in the case of all such price control situations, shortages and queuing resulted.

It is too bad in a way that most folks today can't really remember the gas lines of 1973 and again in 1978.  It was my job in 1978 as the new driver in the family to go wait in line for gas for all the family cars.  I wasted hours and hours sitting in gas lines. I wonder if anyone has every computed the economic value of the time lost to Americans sitting in gas lines because politicians did not want the price to rise by 20 cents.

A number of my friends who knew my dad was an Exxon executive were surprised at my waiting in lines, and wondered why we didn't get some sort of secret access to gas.  But my family waited in lines like everything else.

Well, almost like everyone else.  Because of my dad's position, we did have a bit of information most people did not have, at least in the first shock of 1973.  It was not a secret, it was just totally unreported in the media.  The key was the knowledge of a piece of Congressional legislation called the Emergency Petroleum Allocation Act of 1973.  It had an enormous impact on exacerbating the urban gas lines, but either out of a general ignorance or else a media/academic desire not to make government regulation look bad, it is as unknown today as it was unreported in 1973.

What the law did was this -- it mandated that oil companies distribute gasoline geographically in the US in the same proportion that it was sold in the prior year.  So if they sold x% in area Y last year before the embargo, x% must be distributed to area Y this year after the embargo.  I can't remember the exact concern, but Congress had some fear that oil companies would somehow respond to price signals in a way that caused gasoline allocations to hose someone somewhere.

Anyway, the effect was devastating, probably even worse than the effect of price controls.  The reason was that while Congress forced gasoline supply distribution patterns to remain the same as the prior year (in classic directive 10-289 style), demand patterns had changed a lot.  Specifically, with the fear that gas might not be available over the road and looming economic problems, people cancelled their summer long-distance driving trips.

Everyone stayed home and didn't drive the Interstates cross-country.  So there was little demand for gas at the stations that served these routes.  But by law, oil companies had to keep delivering gasoline to these typically rural stations.  So as urban drivers fumed sitting in gas lines for hours and hours, many rural locations were awash in gas.  Populist Congressmen berated oil companies in the press for the urban gas shortages and lines, all while it was their stupid, ill-considered laws that created a lot of the problem.

So this was the fact that should have been public, but was not: That instead of sitting in urban gas lines for four hours, one could drive 30 minutes into the countryside and find it much easier.  Which is what we did, a number of times.

By the way, it was about this time that I read Hedrick Smith's great book "The Russians."  It was, for the time, a nearly unique look at the life of ordinary Russians under Soviet communism.  I wish the book were still in print (I would love to see one of the free market think tanks do a reissue, at least on Kindle).  Anyway, about 80% of the book seemed to be about how individual Russians dealt with constant shortages and ubiquitous queuing.  It seemed that a lot of the innovation in the general populace was channeled into just these concerns.  What a waste.  Dealing with the 1970s gas lines and shortages is about the closest I have ever come to the life described in that book.

Low Oil Prices and Prosperity

I continue to see reports about how bad falling oil prices are for the economy -- most recently some layoffs in the steel industry were blamed on the looming drop (or crash) in oil drilling and exploration driven by substantially lower prices.

I find this exasperating, a classic seen-and-unseen type failure whose description goes back at least to the mid-19th century and Bastiat and essentially constituted most of Hazlitt's one lesson on economics.  Yes, very visibly, relatively high-paid steel and oil workers are going to lose their jobs.  They will have less money to spend.  The oil industry will have less capital spending.

But the world will pay over a trillion dollars less this year for oil than it did last year (if current prices hold).  That is a huge amount of money that can be spent on or invested in something else.  Instead of just getting oil with those trillion dollars, we will still have our oil and a trillion dollars left over to spend.   We may never know exactly who benefits, but those benefits are definitely there, somewhere.  Just because they cannot be seen or portrayed in short visual anecdotes on the network news does not mean they don't exist.

Ugh, this is just beyond frustrating.  I would have bet that at least with oil people would have understood the unseen benefit, since we get so much media reportage and general angst when gas prices go up that people would be thrilled at their going down.  But I guess not.

I explained in simple terms why the world, mathematically, HAS to be better off with lower oil prices here.

I Believe the Trend Was Caused by All the Things I Believed Before I Investigated the Trend

This is so common that there ought to be a name for it (perhaps there is and I just don't know it):  Writer does a story or study on some trend, in this case the downfall of the enclosed shopping mall.  In each case, the writer discovers that such malls died because of ... all the things the writer already holds dear.  If the writer hates American consumerism, then the fall of such malls is a backlash against American consumerism.

It is interesting to note that all of the ideas quoted are demand-side explanations, e.g. why might consumers stop going to large enclosed malls.  And certainly I find the newer outdoor malls more congenial personally, but this can't be the only explanation.  Here in north Phoenix, I can see the dying enclosed Paradise Valley Mall out my window, but just a few miles away is the Scottsdale Fashion Square, a traditional mall that appears to be going great guns.  Ditto the Galleria in Houston.  Perhaps part of the answer is that enclosed malls were simply overbuilt and that people are willing to drive a bit to get to the best enclosed mall in town rather than a smaller version closer to their home (certainly Mall of America made a big bet on that effect).

But it also strikes me there are supply side considerations.  The mall out my window is a huge waste of space, surrounded by parking lots the size of a small county.  And it's just retail.  Modern outdoor malls allow developers to mix shopping, living, and office space in what looks to my eye to be a much denser development.  All these malls have stores on the ground floor with condos and offices up above.  To my not-real-estate-trained eye, this would seem to increase the potential rents in a given piece of land and provide some synergies among the local businesses (e.g. office workers and residents eat and shop in the mall shops).  In some sense it is a re-imagining of the downtown urban space in a suburban context.  This is ironic because it is something urban planners have been trying to force for decades and here comes the free market to do it on its own.

People also like going to newer facilities.  Just ask hotel owners.  If owners do not totally refresh a hotel every 20 years or so, people stop visiting and rates fall.  The same is true of gas stations and convenience stores.  When I worked at Exxon briefly, they said they budgeted to totally rebuild a gas station every 20 years.  So it is not impossible there is a big supply-side explanation here -- if people are reluctant to go to establishments over 20 years old, then visitation of enclosed malls should be collapsing right about now, 20 years after they stopped being built.  A shift in developer preferences could be a large element driving this behavior.  I don't insist that the supply side and real estate incentives are the only explanation, but I think they are a part of it.

Trend That is Not A Trend: Increase in Typhoons and Hurricanes

The science that CO2 is a greenhouse gas and causes some warming is hard to dispute.  The science that Earth is dominated by net positive feedbacks that increase modest greenhouse gas warming to catastrophic levels is very debatable.  The science that man's CO2 is already causing an increase in violent and severe weather is virtually non-existent.

Seriously, of all the different pieces of the climate debate, the one that is almost always based on pure crap are the frequent media statements linking manmade CO2 to some severe weather event.

For example, Coral Davenport in the New York Times wrote the other day:

As the torrential rains of Typhoon Hagupit flood thePhilippines, driving millions of people from their homes, the Philippine government arrived at a United Nationsclimate change summit meeting on Monday to push hard for a new international deal requiring all nations, including developing countries, to cut their use of fossil fuels.

It is a conscious pivot for the Philippines, one of Asia’s fastest-growing economies. But scientists say the nation is also among the most vulnerable to the impacts of climate change, and the Philippine government says it is suffering too many human and economic losses from the burning of fossil fuels....

A series of scientific reports have linked the burning of fossil fuels with rising sea levels and more powerful typhoons, like those that have battered the island nation.

It is telling that Ms. Davenport did not bother to link or name any of these scientific reports.  Even the IPCC, which many skeptics believe to be exaggerating manmade climate change dangers, refused in its last report to link any current severe weather events with manmade CO2.

Roger Pielke responded today with charts from two different recent studies on typhoon activity in the Phillipines.  Spot the supposed upward manmade trend.  Or not:




I am not a huge fan of landfalling cyclonic storm counts because whether they make landfall or not can be totally random and potentially disguise trends.  A better metric is the total energy of cyclonic storms, land-falling or not, where again there is no trend.

Via the Weather Underground, here is Accumulated Cyclonic Energy for the Western Pacific (lower numbers represent fewer cyclonic storms with less total strength):



And here, by the way, is the ACE for the whole globe:



Remember this when you see the next storm inevitably blamed on manmade global warming.  If anything, we are actually in a fairly unprecedented (in the last century and a half) hurricane drought.

Equal Protection Under the Law?

Equal protection means that the same law applies to everyone, at least in theory.  But compare these two stories:

1. Exxon fined $600,000 for 85 bird deaths in five states over five years

Exxon Mobil has agreed to pay $600,000 in penalties after approximately 85 migratory birds died of exposure to hydrocarbons at some of its natural gas facilities across the Midwest.

The fine amounts to about $7,000 per dead bird.

The oil company pleaded guilty to causing the deaths of waterfowl, hawks, owls and other protected species, which perished around natural gas well pits or water storage areas in Wyoming, Kansas, Oklahoma, Colorado and Texas over the last five years....

“We are all responsible for protecting our wildlife, even the largest of corporations,” said David M. Gaouette, the United States attorney in Colorado, in a statement accompanying the Justice Department’s announcement.

We are all responsible for protecting our wildlife... except if we are politically-favored solar companies with strong ties to the Obama White House

2. No fines for solar power plant that may be killing 28,000 birds a year

A common sight in the sky above the world's largest solar thermal power plant is a "streamer," a small plume of smoke that occurs without warning. Closer inspection, however, reveals that the source of the smoke is a bird which has inadvertently strayed into the white-hot heat above the plant's many reflecting mirrors. Because the BrightSource Energy plant near Ivanpah uses supercritical steam rather than photovoltaic energy, the sun's heat is reflected off more than 300,000 mirrors to a single point, which is used to drive a steam turbine. The downside of that, of course, is that it's lethal for any wildlife that strays into the picture -- a problem that was recognized well before the facility opened, but now the government has gotten involved.

Government wildlife inspectors believe that insects are drawn to the highly reflective mirrors, which in turn lures local birds to their doom. BrightSource feels that the issue has been overblown, claiming that only 1,000 living creatures will die in a year, but the Center for Biological Diversity believes the actual figure is closer to 28,000. The US Fish and Wildlife service is pushing for more information and an accurate calculation of the deaths before California grants the company any more permits for solar plants.

You can see from the last line that the Feds don't seem to be even considering a penalty, but are just considering whether they should permit such plants in the future.  If the 28,000 figure is correct, this company should be getting $196 million in fines (the Exxon rate of $7000 per bird)  if there was any such thing as equal protection.  Even the company's admitted figure of 1,000 a year is almost 60 times as high as Exxon was penalized for, despite the fact that Exxon experienced the deaths across hundreds of locations in five states and this is just one single solar plant.

The same alternate standard is being applied to the wind energy industry, as I wrote a while back here.

I am Pretty Sure Bastiat Figured This Out 150 Years Ago: Cash For Clunkers Even Worse Than First Thought

From the WSJ

In a National Bureau of Economic Research working paper this month, economists at Texas A&M return to Cash for Clunkers, the 2009 stimulus fillip that dispensed vouchers worth as much as $4,500 if people turned in their old cars for destruction and bought a new set of wheels. Mark Hoekstra, Steven Puller and Jeremy West report their "striking" finding that the $3 billion program's two-month run subtracted between $2.6 billion and $4 billion from the auto industry.

The irony is that the goals were to help Detroit through the recession by subsidizing sales and to please the green lobby by putting more fuel-efficient cars on the road. By pulling forward purchases that consumers would make later anyway, the Obama Administration also hoped to add to GDP. Christina Romer, then chair of the Council of Economic Advisers, called Cash for Clunkers "very nearly the best possible countercyclical fiscal policy in an economy suffering from temporarily low aggregate demand."

The A&M economists had the elegant idea of comparing the buying behavior of Texas drivers who owned cars that barely qualified for cash (those that got 18 miles per gallon of gas or less) and those that barely did not (19 mph). Using state DMV sales records, this counterfactual allowed them to isolate the effects of the Cash for Clunkers incentives and show what would have happened without the program.

The two groups were equally likely to purchase a new vehicle over the nine month period that started with Cash for Clunkers, so the subsidy did not create any extra auto business. But in order to meet the fuel efficiency mandate, consumers who got the subsidy were induced to purchase smaller vehicle models with less horsepower that cost on average $2,500 to $3,000 less than those bought by their ineligible peers. The clunkers bought more Corollas, and everybody else more Chevys.

Extrapolated nationally, auto revenues may have plunged by more than what the government spent. And any environmental benefits cannot be justified under the federal social cost of carbon estimate of $33 a ton. Prior research from 2009 and 2013 has shown that the program cost between $237 and $288 a carbon ton.