“We oppose ALL subsidies, whether existing or proposed, including programs that benefit us, which are principally those that are embedded in our economy, such as mandates,” wrote Philip Ellender, president Koch’s government affairs division, in a Wednesday letter to members of Congress.
Ellender singled out the wind production tax credit as particularly deleterious. But unlike that provision, some of the tax breaks included in the House package benefit activities in which Koch and its subsidiaries are heavily invested.
Koch subsidiary George Pacific, for instance, qualifies for a tax break for the production of cellulosic biofuels. Another subsidiary, Flint Hills Resources, operates biofuel production facilities that could benefit from another of the provisions.
Those tax breaks could improve Koch’s bottom line, but the company sees federal tax preferences in general as economically harmful.
“Koch doesn’t view these as ‘benefits’ even if they are in industries we’re in,” explained a source familiar with the company’s public affairs strategy. “They are wasteful and market distorting, and allow other firms to run businesses that aren’t making money any other way.”
Posts tagged ‘wind’
The government claims to be making huge profits on its greentech loan program, despite losses at companies like Solyndra.
The U.S. government expects to earn $5 billion to $6 billion from the renewable-energy loan program that funded flops including Solyndra LLC, supporting President Barack Obama’s decision to back low-carbon technologies.
The Department of Energy has disbursed about half of $32.4 billion allocated to spur innovation, and the expected return will be detailed in a report due to be released as soon as tomorrow, according to an official who helped put together the data.
The results contradict the widely held view that the U.S. has wasted taxpayer money funding failures including Solyndra, which closed its doors in 2011 after receiving $528 million in government backing. That adds to Obama’s credibility as he seeks to make climate change a bigger priority after announcing a historic emissions deal with China.
Even Kevin Drum calls partial BS on this:
And yet....I'd still remain a bit cautious about the overall success of the program. Out of its $32 billion in approved loans, half represent loan guarantees to nuclear power plant developers and Ford Motor. These are not exactly risky, innovative startups. They're huge companies that could very easily have raised money without government help, and which represented virtually zero danger of default. If DOE is including returns from those loans in its forecast, color me unimpressed.
The genuinely risky half of the loan program is called Section 1705, and it includes everything that most of us think of as real renewable energy projects (wind, solar, biofuel, etc.). DOE hasn't broken that out separately.
I call further BS. It turns out this program is actually losing money, not making money.
- This "study" is a classic case of assuming your conclusion. The reason the risky parts of the portfolio would lose money is if they don't pay off over the next 20 years or so they have to run. But all the study says is "The $5 billion to $6 billion figure was calculated based on the average rates and expected returns of funds dispersed so far, paid back over 20 to 25 years." In other words, if the loans turn out not to be risky, they won't be risky. LOL.
- I bet they are not accounting for things like Ivanpah, there the holders of the government loan are looking to pay off the government loan with .. a government subsidy. So if you squint, the loan to Ivanpah looks profitable, but no rational person would come to that conclusion about the program as a whole.
- Ivanpah is just a subset of a larger problem. Companies like Tesla get government subsidies (and their customers get subsidies as well) from dozens of sources. Is it really a win for taxpayers if they pay back their government loan with government money?
- They count the 37 basis points above treasury rates that they charge as "profit". This is crazy. I run a fairly large business. No business is getting Tbills +37 BP loans. Heck, since Tbills are at about 0%, this means they are loaning money to private concerns at less than 1%. This is a crazy large subsidy. I could make money in over a 2-5 year period in just about anything if I could borrow at effectively 0%.
- Worst of all, they are not using present value. Let's say their average spread from the Bloomberg article is 100 BP over treasuries. That means that ignoring loan losses on a $32 billion portfolio they are making a spread of $320 million a year. Over 20-25 years that is $6-7 billion. Less some large loan losses that is $5-6 billion. But notice I never discounted. This is just adding up nominal interest spreads over 25 years. This is insane. Absolutely no private investor on the planet would think like this. If you discounted the interest spread payments at any reasonable risk-adjusted rate**, then the net present value may already be less than losses in Solyndra and others and thus already in the hole, even without considering future losses. This report is an embarrassing political exercise, not a serious economic analysis.
All of this leaves out the inherent cronyism of the whole exercise.
** I would argue that in many of these loans, and despite interest rates charged in the 0-2% range, the government was taking an equity risk. Worse than equity risks -- these are essentially venture capital investments risks with T-bill returns (note the one private comment on the returns in the Bloomberg article is from a venture capital investor in greentech). The taxpayers are bearing all the risk but getting none of the returns. Any discount rate for these risks under 15-20% is far too low.
Equal protection means that the same law applies to everyone, at least in theory. But compare these two stories:
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
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.
Charles Frank of Brookings has looked at the relative returns of various energy investments in the context of reducing CO2. The results: The best answer is natural gas, with nothing else even close. Solar and Wind can't even justify their expense, at least from the standpoint of reducing CO2. Here is the key chart (Hat tip Econlog)
Note that this is not a calculation of the economic returns of these types of power plants, but a relative comparison of how much avoided costs, mainly in CO2 emissions (valued at $50 per ton), there are in switching from coal to one of these fuel sources. Natural gas plants are the obvious winner. It remains the winner over solar and wind even if the value of a ton of CO2 is doubled to $100 and both these technologies are assumed to suddenly get much more efficient. Note by the way that unlike wind and solar (and nuclear), gas substitution for coal plant yields a net economic benefit (from reduced fuel and capital costs) above and beyond the avoided emissions -- which is why gas is naturally substituting right now for coal even in the absence of a carbon tax of some sort to impose a cost to CO2 emissions.**
I was actually surprised that wind did not look even worse. I think the reason for this is in how the author deals with wind's reliability issues -- he ends up discounting the average capacity factor somewhat. But this understates the problem. The real reliability problem with wind is that it can stop blowing almost instantaneously, while it takes hours to spin up other sorts of power plants (gas turbines being the fastest to start up, nuclear being the slowest). Thus power companies with a lot of wind have to keep fossil fuel plants burning fuel but producing no power, an issue called hot backup. This issue has proved itself to substantially reduce wind's true displacement potential, as they found in Germany and Denmark.
There is no evidence that industrial wind power is likely to have a significant impact on carbon emissions. The European experience is instructive. Denmark, the world's most wind-intensive nation, with more than 6,000 turbines generating 19% of its electricity, has yet to close a single fossil-fuel plant. It requires 50% more coal-generated electricity to cover wind power's unpredictability, and pollution and carbon dioxide emissions have risen (by 36% in 2006 alone).
Flemming Nissen, the head of development at West Danish generating company ELSAM (one of Denmark's largest energy utilities) tells us that "wind turbines do not reduce carbon dioxide emissions." The German experience is no different. Der Spiegel reports that "Germany's CO2 emissions haven't been reduced by even a single gram," and additional coal- and gas-fired plants have been constructed to ensure reliable delivery.
Indeed, recent academic research shows that wind power may actually increase greenhouse gas emissions in some cases, depending on the carbon-intensity of back-up generation required because of its intermittent character.
** Postscript: The best way to read this table, IMO, is to take the net value of capacity and energy substitution and compare it to the CO2 savings value.
The first line is just from the first line of the table above. The second is essentially the net of all the other lines.
I think this makes is clearer what is going on. For wind, we invest
$106,697 for $132,030 $132,030 for $106,697 in emissions reduction (again, I think the actual number is lower). In Solar, we invest $258,322 for $69,502 in emissions reduction. For gas, on the other hand, we have no net investment -- we actually have a gain in these other inputs from the switch -- and then we also save $416,534. In other words, rather than paying, we are getting paid to get $416,534 in emissions reduction. That is not several times better than Solar and Wind, it is infinitely better.
Postscript #2: Another way to look at this -- if you put on a carbon tax in the US equal to $50 per ton of CO2 that fuel would produce, then it still likely would make no sense to be building wind or solar plants unless there remained substantial subsidies for them (e.g. investment tax credits, direct subsidies, guaranteed loans, above-market electricity pricing, etc). What we would see is an absolute natural gas plan craze.
Check out this payback analysis that is being trumpeted for wind power:
US researchers have carried out an environmental lifecycle assessment of 2-megawatt wind turbines mooted for a large wind farm in the US Pacific Northwest. Writing in the International Journal of Sustainable Manufacturing, they conclude that in terms of cumulative energy payback, or the time to produce the amount of energy required of production and installation, a wind turbine with a working life of 20 years will offer a net benefit within five to eight months of being brought online.
So of all the scarce resources that go into producing wind power, if you look at only one of these (energy), then the project pays itself back in less than a year. This is stupid. Yes, I understand that there are some "green" energy sources (*cough* corn ethanol *cough*) that cannot even produce more energy than they consume, so I suppose this finding is a step forward from that. But what about all the other scarce resources used in producing wind power-- steel, labor, engineering talent, concrete, etc? This is roughly like justifying the purchase of an 18-wheeler truck by saying it will pay off all the vanadium used in its production in less than a year.
Environmentalists seem to all feel that capitalism is the enemy of sustainability, but in fact capitalism is the greatest system to promote sustainability that has ever been devised. Every single resource has a price that reflects its relative scarcity as compared to demand. Scarcer resources have higher prices that automatically promote conservation and seeking of substitutes. So an analysis of an investment's ability to return its cost is in effect a sustainability analysis. What environmentalists don't like is that wind does not cover the cost of its resources, in other words it does not produce enough power to justify the scarce resources it uses. Screwing around with that to only look at some of the resources is just dishonest.
The one reasonable argument is that the price of fuels does not adequately reflect the externalities of Co2 production. I don't think these are high but obviously there are those who disagree. The right way to do this analysis is to say that wind power provides a return only if electricity prices are X (X likely being well above current market rates) which in turn reflects a Co2 cost of Y $/ton. My gut feel is that it would take a Y -- a cost per ton of CO2 -- way higher than any of the figures that are typically bandied about even by environmentalists to make wind work.
Postscript: I did not critique the analysis of energy payback per se, but if I were to dig into it, I would want to look at two common fallacies with many wind analyses. 1) They typically miss the cost of standby power needed to cover wind's unpredictability, which has a substantial energy cost. In Germany, during their big wind push, they had to have 80-90% of wind power backed up with hot fossil fuel backup. 2) They typically look at nameplate capacity and not real capacities in the field. In fact, real capacities should further be discounted for when wind power produces electricity that the grid cannot take (ie when there is negative pricing in the wholesale market, which actually occurs).
Environmentalists are trying to list such ubiquitous species as prairie chickens in order to halt oil and gas development in most of the west. Presumably, wind farms would be given a special exemption.
So after spending billions to subsidize the construction and operation of wind farms, Britain has discovered that their output variability is a problem and that they produce too much of their power at night (issues many of us predicted long before they were built). So now England is facing the policy choice of either a) paying wind farm owners to NOT product power or b) paying factory owners to switch their operations to night time. Seriously. For most areas, wind is among the worst possible electricity source.
You have heard of the Atlantic triangle trade in school. It is always discussed in terms of its economic logic (e.g. English rum to African slaves to New World sugar). But the trade has a physical logic as well in the sailing ship era. Current wind patterns:
Seriously, click on the real time link. Even if you are jaded, probably the coolest thing you will see today. One interesting thing to look at -- there is a low point in the spine of the mountains of Mexico west of Yucatan. Look at the wind pour through it like air out of a balloon.
I have not written much about climate of late because my interest, err, runs hot and cold. As most readers know, I am in the lukewarmer camp, meaning that I accept that Co2 is a greenhouse gas but believe that catastrophic warming forecasts are greatly exaggerated (in large part by scientifically unsupportable assumptions of strong net positive feedback in the climate system). If what I just said is in any way news to you, read this and this for background.
Anyway, one thing I have been saying for about 8 years is that when the history of the environmental movement is written, the global warming obsession will be considered a great folly. This is because global warming has sucked all the air out of almost anything else in the environmental movement. For God sakes, the other day the Obama Administration OK'd the wind industry killing more protected birds in a month than the oil industry has killed in its entire history. Every day the rain forest in the Amazon is cleared away a bit further to make room for ethanol-making crops.
This picture demonstrates a great example of what I mean. Here is a recent photo from China:
You might reasonably say, well that pollution is from the burning of fossil fuels, and the global warming folks want to reduce fossil fuel use, so aren't they trying to fight this? And the answer is yes, tangentially. But here is the problem: It is an order of magnitude or more cheaper to eliminate polluting byproducts of fossil fuel combustion than it is to eliminate fossil fuel combustion altogether.
What do I mean? China gets a lot of pressure to reduce its carbon emissions, since it is the largest emitter in the world. So it might build a wind project, or some solar, or some expensive high speed rail to reduce fossil fuel use. Let's say any one of these actions reduces smog and sulfur dioxide and particulate pollution (as seen in this photo) by X through reduction in fossil fuel use. Now, let's take whatever money we spent in, say, a wind project to get X improvement and instead invest it in emissions control technologies that the US has used for decades (coal plant scrubbers, gasoline blending changes, etc) -- invest in making fossil fuel use cleaner, not in eliminating it altogether. This same money invested in this way would get 10X, maybe even up to 100X improvement in these emissions.
By pressuring China on carbon, we have unwittingly helped enable their pollution problem. We are trying to get them to do 21st century things that the US can't even figure out how to do economically when in actuality what they really need to be doing is 1970's things that would be relatively easy to do and would have a much bigger impact on their citizen's well-being.
The confrontation may be coming soon in the environmental community over wind power -- it certainly would have occurred already had the President promoting wind been Republican rather than Democrat. I might have categorized this as "all energy production has environmental tradeoffs", but wind power is so stupid a source to be promoting that this is less of a tradeoff and more of another nail in the coffin. As a minimum, the equal protection issues vis a vis how the law is enforced for wind companies vs. oil companies are pretty staggering.
“It happens about once a month here, on the barren foothills of one of America’s green-energy boomtowns: A soaring golden eagle slams into a wind farm’s spinning turbine and falls, mangled and lifeless, to the ground.
Killing these iconic birds is not just an irreplaceable loss for a vulnerable species. It’s also a federal crime, a charge that the Obama administration has used to prosecute oil companies when birds drown in their waste pits, and power companies when birds are electrocuted by their power lines.”
“[The Obama] administration has never fined or prosecuted a wind-energy company, even those that flout the law repeatedly. Instead, the government is shielding the industry from liability and helping keep the scope of the deaths secret.”
“Wind power, a pollution-free energy intended to ease global warming, is a cornerstone of President Barack Obama’s energy plan. His administration has championed a $1 billion-a-year tax break to the industry that has nearly doubled the amount of wind power in his first term. But like the oil industry under President George W. Bush, lobbyists and executives have used their favored status to help steer U.S. energy policy.”
“The result [of Obama energy policy] is a green industry that’s allowed to do not-so-green things. It kills protected species with impunity and conceals the environmental consequences of sprawling wind farms.”
“More than 573,000 birds are killed by the country’s wind farms each year, including 83,000 hunting birds such as hawks, falcons and eagles, according to an estimate published in March in the peer-reviewed Wildlife Society Bulletin.
On the right, both climate change and questions about global limits on oil production have exited the realm of empirical debate and become full-blown fronts in the culture wars. You're required to mock them regardless of whether it makes any sense. And it's weird as hell. I mean, why would you disparage development of renewable energy? If humans are the ultimate creators, why not create innovative new sources of renewable energy instead of digging up every last fluid ounce of oil on the planet?
I am sure it is perfectly true that there are Conservatives who knee-jerk oppose every government renewable energy and recycling and green jobs idea that comes along without reference to the science. But you know what, there are plenty of Liberals who knee-jerk support all these same things, again without any understanding of the underlying science. Mr. Drum, for example, only recently came around to opposing corn ethanol, despite the fact that the weight of the science was against ethanol being any kind of environmental positive years and years ago. In fact, not until it was no longer cool and caring to support ethanol (a moment I would set at when Rolling Stone wrote a fabulous ethanol expose) did Drum finally turn against it. Is this science, or social signalling? How many folks still run around touting electric cars without understanding what the marginal fuels are in the electricity grid, or without understanding the true well-to-wheels efficiency? How many folks still run around touting wind power without understanding the huge percentage of this power that must be backed up with hot backup power fueled by fossil fuels?
Why is his almost blind support of renewable energy without any reference to science or the specifics of the technologies involved any saner than blind opposition? If anything, blind opposition at least has the numbers on their side, given past performance of investments in all sorts of wonder-solutions to future energy production.
The reason there is a disconnect is because statists like Drum equate supporting government subsidies and interventions with supporting renewables. Few people, even Conservatives, oppose renewables per se. This is a straw man. What they oppose are subsidies and government mandates for renewables. Drum says he has almost limitless confidence in man's ability to innovate. I agree -- but I, unlike he apparently, have limitless confidence in man's ability to innovate absent government coercion. It was not a government program that replaced whale oil as an illuminant right when we were approaching peak whale, it was the genius of John D. Rockefeller. As fossil fuels get short, prices rise, and people naturally innovate on substitutes. If Drum believes that private individuals are missing an opportunity, rather than root for government coercion, he should go take up the challenge. He can be the Rockefeller of renewable energy.
Postscript: By the way, it is absurd and disingenuous to equate opposition to what have been a series of boneheaded government investments in questionable ventures and technologies with some sort of a-scientific hatred of fossil fuel alternatives. I have written for a decade that I long for the day, and expect it to be here within 20 years, that sheets of solar cells are cranked from factories like carpet out of Dalton, Georgia.
How the recent "fairness" tax bill became a vehicle for subsidizing connected corporations.
Baucus' Finance Committee passed a bill in August extending 50 expiring deductions and credits for favored industries. At Obama's insistence, the Baucus bill was cut and pasted word for word into the cliff legislation. Set aside for a moment how this contradicts Obama's talk about "fair shares" and the need to diminish the influence of lobbyists, and look at what this raft of tax favors shows us about the Baucus Machine.
Pick any one of the special-interest tax breaks extended by the cliff deal, and you're likely to find a former Baucus aide who lobbied for it on behalf of a large corporation or industry organization.
General Electric may have been the biggest winner from the cliff deal. GE makes more wind turbines than any other U.S. company, and it lobbied hard for extension of the wind production tax credit. But more important for the multinational conglomerate was an arcane-sounding provision that became Section 222 of Baucus' bill and then Section 322 of the cliff bill: "Extension of subpart F exception for active financing income."
In short, this provision allows multinationals to move profits to offshore financial subsidiaries and thus avoid paying U.S. corporate income taxes. This is a windfall for GE: The exception played a central role in GE paying $0 in U.S. corporate income tax in 2011 when it made $5.1 billion in U.S. profits.
Peter Prowitt, formerly Baucus' chief of staff, is now an in-house lobbyist and VP at GE. GE filings show Prowitt on the lobbying teams that won wind-tax credits, electric-vehicle tax credits, and "Extension of Subpart F Deferral for Financial Services."
The examples in the article go on and on. The best way to get rich in America is not to have a great idea or work hard but to hire an ex-staffer from Senator Baucus's office.
I drove through Indio / Palm Springs on Tuesday and was aggravated, as I always am, at just how few of the zillions of government-subsidized windmills are actually turning. Saying that one in twenty were generating power would be generous. I know the wind was blowing because a few of them were turning.
On Thursday I drove back through and tried to take a video, though all I had was my iPhone.
You have to squint to see all the dead windmills in the back of the first shot. If you have never been to this site, you many not be able to comprehend just how far in the distance the dead masts go. Here is another shot from several miles further down the site
Here is my proposal. We make this whole area a National Park and call it "Corporate State Park." It would be at least as educational as any other National Park.
Just days after the Export-Import Bank approved a multi-million dollar federal loan guarantee to benefit a mostly foreign-based wind-energy outfit, the company pink-slipped more than 200 American workers.
The Export-Import Bank, a federal agency that promotes and finances sales of U.S. exports to foreign buyers, approved a $32 million loan guarantee on Aug. 2 for a Brazilian firm to purchase wind turbines from LM Wind Power. According to itswebsite, LM Wind Power is headquartered in Denmark.
“Ex-Im Bank’s financing, which guarantees a Bank of America loan, will support approximately 250 permanent American jobs at the company’s Little Rock, Ark., and Grand Forks, N.D., manufacturing facilities,” the bank said in a release.
The company maintains a manufacturing presence in Arkansas and North Dakota—but the company laid off 234 of the Arkansas plant’s roughly 300 workers just two days after its loan was approved.
“We have this week told our workforce that we are re-sizing our workforce and business to fit our plans for 2013,” Adam Ruple, human resources director for LM Wind Power, told the City Wire of Arkansas.
A spokesman for LM Wind Power referred the Free Beacon to the company’s website.
When LM Wind Power came to Little Rock, Arkansas, in 2007, it said it would employ 1,000 people by 2012. But the global economic crunch led to diminishing demand. Three months before its loan guarantee was finalized, LM Wind Power announced its profits had fallen 41 percent last year.
It really takes some amazing stones to grab a $32 million subsidized government loan on the promise to add 250 jobs just days before a planned 234-person layoff.
Every single time that wind power installations are evaluated based on their actual performance, they turn out to make no economic sense. Consumer Reports comes to the same conclusion for their wind power trial (and this does not even include the issues of standby power that make even small wind power savings irrelevant to CO2 production).
But if you're considering a wind turbine to supplement your home's power, consider our experience with one product, the Honeywell WT6500 Wind Turbine, a cautionary tale....
A tool on Windtronics' website had calculated we'd get 1,155 kWh per year at the 12-mph average it predicted for our area of Yonkers, New York. And the authorized installer, during his initial visit, didn't say the roof of our headquarters might generate any less, but that rating is at a height of 164 feet, not the 33 feet WindTronics requires for rooftop installations.
In the 15 months since the turbine was installed, though, it has delivered less than 4 kWh—enough only to power a 12,000 btu window air conditioner for one afternoon. A company representative in charge of installations worldwide recently visited our offices and confirmed that our test model was correctly installed. What's more, he told us that while the WT6500 should start generating power at about 3 mph, the initial juice goes just to power the system's inverter, which must be running before it supplies any AC power elsewhere. The true wind speed needed to start producing AC while the inverter is on is 6 mph, not far from the 7.5 mph needed by a traditional gearbox wind turbine....
At the rate the WT6500 is delivering power at our test site, it would take several millennia for the product to pay for itself in savings—not the 56 years it would take even with the 1,155 kWh quote we received.
After years of apparently being OK with California's absurd restrictions on development and crazy environmental laws that tied most everything new up in the courts for years, Kevin Drum suddenly thinks they may be flawed now that they are slowing development he likes (wind, solar, high density housing around transit stations). Drum is a classic technocrat, who is OK with absolute state authority as long as the state is doing what he wants it to do. I am reminded of what I wrote technocrats 7(!) years ago:
Technocratic idealists ALWAYS lose control of the game. It may feel good at first when the trains start running on time, but the technocrats are soon swept away by the thugs, and the patina of idealism is swept away, and only fascism is left. Interestingly, the technocrats always cry “our only mistake was letting those other guys take control”. No, the mistake was accepting the right to use force on another man. Everything after that was inevitable.
I am reminded of all this because the technocrats that built our regulatory state are starting to see the danger of what they created. A public school system was great as long as it was teaching the right things and its indoctrinational excesses were in a leftish direction. Now, however, we can see the panic. The left is freaked that some red state school districts may start teaching creationism or intelligent design. And you can hear the lament – how did we let Bush and these conservative idiots take control of the beautiful machine we built? My answer is that you shouldn’t have built the machine in the first place – it always falls into the wrong hands. Maybe its time for me to again invite the left to reconsider school choice.
Today, via Instapundit, comes this story about the GAO audit of the decision by the FDA to not allow the plan B morning after pill to be sold over the counter. And, knock me over with a feather, it appears that the decision was political, based on a conservative administration’s opposition to abortion. And again the technocrats on the left are freaked. Well, what did you expect? You applauded the Clinton FDA’s politically motivated ban on breast implants as a sop to NOW and the trial lawyers. In establishing the FDA, it was you on the left that established the principal, contradictory to the left’s own stand on abortion, that the government does indeed trump the individual on decision making for their own body (other thoughts here). Again we hear the lament that the game was great until these conservative yahoos took over. No, it wasn’t. It was unjust to scheme to control other people’s lives, and just plain stupid to expect that the machinery of control you created would never fall into your political enemy’s hands.
I don't really want to ridicule Kevin Drum here for thinking out loud. I really hate partisan Conservative and Liberal team-politics blogs, but I read a few to stay out of the echo chamber, and Drum is smarter and incrementally more objective (a relative thing) than most.
These two things together reminded me about an energy factoid that's always struck me as slightly odd: virtually every form of energy seems to be almost as efficient as burning oil, but not quite.
For example, on either a power/weight basis or a cost basis, batteries are maybe 2x or 3x bigger and less efficient than an internal combustion engine. Not 50x or 100x. Just barely less efficient. And you see the same thing in electricity generation. Depending on how you do the accounting, nuclear power is maybe about as efficient as an oil-fired plant, or maybe 2x or 3x less efficient. Ditto for solar. And for wind. And geothermal. And tidal power.
I'm just noodling vaguely here. Maybe there's an obvious thermodynamic explanation that I'm missing. It's just that I wouldn't be surprised if there were lots of ways of generating energy that were all over the map efficiency-wise. But why are there lots of ways of generating energy that are all surprisingly similar efficiency-wise? In the great scheme of things, a difference of 2x or 3x is practically invisible.
First, we have to translate a bit. He mentions power to weight ratios for batteries in the second paragraph. In fact, batteries have terrible power (actually energy storage) to weight ratios vs. fossil fuels, much worse than 2-3x for energy storage per unit of weight or volume. That is why gasoline is still the transportation energy source of choice, because very few things short of plutonium have so much potential energy locked up in so little volume. But I will assume he is comparing an entire electric drive system compared to a gasoline drive system (including not just energy storage but the drive itself) and in this case the power to weight ratios are indeed closer.
But here is the problem: in engineering, a 2-3x difference in most anything -- strength, energy efficiency, whatever -- is a really big deal. It's the difference between 15 and 45 MPG. Perhaps this is Moore's Law corrupting our intuition. We see electronic equipment becoming twice as powerful every 18 months, and we start to assume that 2x is not that much of a difference.
But this is why Moore's Law is so much discussed, because of its very uniqueness. In most fields, engineers tinker for decades for incremental improvements, sometimes in the single digit percentages.
The fact that alternative energy supporters feel like their preferred technologies are just so close, meaning they are only 2x-3x less efficient than current technologies, explains a lot about why we skeptics of these technologies have a hard time getting through to them.
One thing that many green energy advocates fail to understand is the very scale of US energy demand in relation to the output of various green sources.
Let's consider wind.
The Keystone XL pipeline would have provided 900,000 barrels of oil per day, roughly equivalent to 1.53 billion kw-hr per day. A typical wind turbine is 2MW nameplate capacity, but at best actually produces about 30% of this on average. This means that in a day it produces 2,000*.3*24 = 14,400 kw-hr of electricity. This means that the Keystone XL pipeline would have transported an amount of energy to the US equal to the output of 106,250 of those big utility-size wind turbines.
Looked at another way, the entire annual output of the US wind energy sector was about 75 terra-watt-hours per year or about 260 million kw-hr per day. This means that the Keystone XL pipeline would have carried energy equal to over 5 times the total output of wind power in the US.
Of course, this is just based on the potential energy in the fuel, and actual electricity production would be 50-65% less. But even so, this one single pipeline, out of many, is several times larger than the entire wind power sector.
It is December, 2005. The Gulf Coast had just been pounded, in succession, by Katrina, Rita, and Wilma. Everyone was talking about how global warming seemed to be intensifying hurricanes. In a speech just after Katrina, Al Gore said
When the corpses of American citizens are floating in toxic floodwaters five days after a hurricane strikes, it is time not only to respond directly to the victims of the catastrophe but to hold the processes of our nation accountable, and the leaders of our nation accountable, for the failures that have taken place....
There are scientific warnings now of another onrushing catastrophe. We were warned of an imminent attack by Al Qaeda; we didn't respond. We were warned the levees would break in New Orleans; we didn't respond. Now, the scientific community is warning us that the average hurricane will continue to get stronger because of global warming. A scientist at MIT has published a study well before this tragedy showing that since the 1970s, hurricanes in both the Atlantic and the Pacific have increased in duration, and in intensity, by about 50 percent....
Two thousand scientists, in 100 countries, engaged in the most elaborate, well-organized scientific collaboration in the history of humankind, have produced long-since a consensus that we will face a string of terrible catastrophes unless we act to prepare ourselves and deal with the underlying causes of global warming....
At about the same time, the IPCC was in the process of preparing its fourth report, later released in 2007. It said, in part:
Several peer-reviewed studies show a clear global trend toward increased intensity of the strongest hurricanes over the past two or three decades. The strongest trends are in the North Atlantic Ocean and the Indian Ocean. According to the 2007 Fourth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC-AR4), it is “more likely than not” (better than even odds) that there is a human contribution to the observed trend of hurricane intensification since the 1970s. In the future, “it is likely [better than 2 to 1 odds] that future tropical cyclones (typhoons and hurricanes) will become more intense, with larger peak wind speeds and more heavy precipitation associated with ongoing increases of tropical [sea surface temperatures].”
So what happened? Since Wilma in 2005, we have gone 6 full years without a category 3+ hurricane making landfall in the US, the longest span since 1900 without such an event. And the clock is still counting. When alarmists of all stripes were breathlessly predicting hurricane after hurricane in late 2005, the reality is that we wouldn't see another in the US for over six years.
Of course, US landfall is in fact a terrible indicator of hurricane activity. Its relevant to us, but it is a pretty random metric. I said this when there were a lot of landfalls and I say it again since there have been so few.
A better metric is accumulated cyclonic energy, a sort of time integral of all large cyclonic storms worldwide. Here is the most recent ACE figures:
As it turns out, the total strength of hurricane and hurricane-like storms has been falling almost since the exact day of Al Gore's speech in 2005 (another Gore effect!) In fact, of late, it has hit numbers close to all-time lows.
Of course this chart will go back up some day, and then back down, and then up ... because hurricane activity has always been cyclical over decadal time scales.
The media loves to trumpet end-of-the-world predictions from folks like Al Gore and Paul Ehrlich, but they never go back five years later and back-check their predictions. And despite their horrendous record for accuracy, the media eagerly publishes the next one. Here is a proposed editorial rule for the MSM -- no breathless publication of anyone's next prediction without first revisiting the last one.
I still contend that wind is, except in a few niche applications, probably the worst alternate energy source. Other forms of energy like solar have issues, but there is a lot of reason to believe these a fixable over time with better technology. Wind is just a plain dog.
One of the biggest problems with wind is the need for backup power. Because wind's lapses are hard to predict, a lot of fossil fuels have to be burned in spinning, hot backup capacity ready at a moment's notice to take over. In Germany, the net effect has been very little substitution of fossil fuel burning despite an enormous wind investment
As wind power capacity rises, the lower availability of the wind farms determines the reliability of the system as a whole to an ever increasing extent. Consequently the greater reliability of traditional power stations becomes increasingly eclipsed.
As a result, the relative contribution of wind power to the guaranteed capacity of our supply system up to the year 2020 will fall continuously to around 4% (FIGURE 7). In concrete terms, this means that in 2020, with a forecast wind power capacity of over 48,000MW (Source: dena grid study), 2,000MW of traditional power production can be replaced by these wind farms.
Natural gas makes this situation a little better, as natural gas turbines can be brought up much faster than, say, an oil or coal-powered plant. But the duplicate investment is still necesary
Britain's richest energy companies want homeowners to subsidise billions of pounds worth of gas-powered stations that will stand idle for most of the time.
Talks have taken place between the Government, Centrica, owner of British Gas, and other energy companies on incentives to build the power stations needed as back-ups for the wind farms now being built around the country.
It is understood 17 gas-fired plants worth about £10 billion will be needed by 2020.
The Energy Department has been warned that without this massive back-up for the new generation of heavily subsidised giant wind farms, the lights could go out when the wind dies down.
Sam Laidlaw, chief executive of Centrica, said renewables, such as large-scale wind energy, were intermittent and required back-up generation, a role gas was uniquely qualified to fill.
But as power stations that operate only intermittently would not be financially viable, Laidlaw said: 'The building of new gas-fired capacity must be incentivised so that gas can fulfil its role as a bridging fuel.'
Great. So we have wind power, which is not financially viable so it must be subsidized, that required backup power plants to be constructed, which will not be financially viable so gas plants must be subsidized.
I have an idea, why not have gas plants which are financially viable serving the base load and just get rid of wind and this double subsidy all together?
This year, US oil refiners will pay more than $6 million in fines to the EPA for not using a product that doesn't exist. Refiners are required to blend at least 6.6 million gallons of cellulosic ethanol this year, or pay a fine to the EPA of $1 per gallon of this target not met.
But here is the funny part - no cellulosic ethanol exists for refiners to buy, even by the EPA's own analysis. The product simply does not exist in any more than pilot plant / experimental volumes. But that is not stopping the EPA from imposing the fines, which will get passed on into gasoline prices.
Here is the saddest part, from a defender of the cellulosic mandates:
Next-generation ethanol advocates say that small-scale commercial production of the fuel is just around the corner. When the EPA proposal was released yesterday, one advocate blamed the oil and gas industry for slow progress.
“America’s advanced and cellulosic ethanol industry is rapidly progressing with many technologies proven and biorefinery projects shovel-ready. Yet, advanced biofuel producers continue to sail into a head wind created by tax policy favoring oil and gas,” said Brooke Coleman, executive director of the Advanced Ethanol Council, in a statement.
What in the hell are they talking about? Their plants get their construction subsidized with public financing, the oil industry is required to buy their product, trade barriers exist to limit foreign competition. These guys are not fighting a headwind, they are trying to hit a golf ball downwind in a hurricane and they still can't clear the lady's tee.
Well, you now have a simple algorithm for sorting flakes and politicized hacks from honest scientists -- anyone who is going around this week saying that the tornadoes in Alabama this week were due to manmade CO2 sit firmly in the former category. First up, Dr. Roy Spencer
If there is one weather phenomenon global warming theory does NOT predict more of, it would be severe thunderstorms and tornadoes.
Tornadic thunderstorms do not require tropical-type warmth. In fact, tornadoes are almost unheard of in the tropics, despite frequent thunderstorm activity.
Instead, tornadoes require strong wind shear (wind speed and direction changing rapidly with height in the lower atmosphere), the kind which develops when cold and warm air masses “collide”. Of course, other elements must be present, such as an unstable airmass and sufficient low-level humidity, but wind shear is the key. Strong warm advection (warm air riding up and over the cooler air mass, which is also what causes the strong wind shear) in advance of a low pressure area riding along the boundary between the two air masses is where these storms form.
But contrasting air mass temperatures is the key. Active tornado seasons in the U.S. are almost always due to unusually COOL air persisting over the Midwest and Ohio Valley longer than it normally does as we transition into spring.
For example, the poster child for active tornado seasons was the Superoutbreak of 1974, which was during globally cool conditions. This year, we are seeing much cooler than normal conditions through the corn belt, even delaying the planting schedule. Cool La Nina years seem to favor more tornadoes, and we are now coming out of a persistent La Nina. The global-average temperature has plummeted by about 1 deg. F in just one year.
An unusually warm Gulf of Mexico of 1 or 2 degrees right now cannot explain the increase in contrast between warm and cold air masses which is key for tornado formation because that slight warmth cannot compete with the 10 to 20 degree below-normal air in the Midwest and Ohio Valley which has not wanted to give way to spring yet.
The “extra moisture” from the Gulf is not that important, because it’s almost always available this time of year…it’s the wind shear that caused this outbreak.
More tornadoes due to “global warming”, if such a thing happened, would be more tornadoes in Canada, where they don’t usually occur. NOT in Alabama.
Thus we yet again run into the logic of the marketing campaign to change the effect of CO2 from global warming to climate change, as if CO2 could somehow make for random climate changes without the intermediate step of warming.
We all draw upon fallible memories to come to conclusions about whether events are more or less prevalent today, and in many cases our memories fail us (often due to observer bias, in particular the increasing frequency of an event in the media being mistaken for the increasing underlying frequency of the event). I will say that my memory is that the seventies were the time in my life with the most severe weather (including horrible regional famines) and the seventies were the coldest decade of my life so far.
Anyway, tornadoes are something we can measure, rather than just remember, so let's go to the data:
In An Inconvenient Truth, Al Gore and company said that global warming was increasing the number of tornadoes in the US. He claimed 2004 was the highest year ever for tornadoes in the US. In his PowerPoint slide deck (on which the movie was based) he sometimes uses this chart (form the NOAA):
Whoa, that’s scary. Any moron can see there is a trend there. Its like a silver bullet against skeptics or something. But wait. Hasn’t tornado detection technology changed over the last 50 years? Today, we have doppler radar, so we can detect even smaller size 1 tornadoes, even if no one on the ground actually spots them (which happens fairly often). But how did they measure smaller tornadoes in 1955 if no one spotted them? Answer: They didn’t. In effect, this graph is measuring apples and oranges. It is measuring all the tornadoes we spotted by human eye in 1955 with all the tornadoes we spotted with doppler radar in 2000. The NOAA tries to make this problem clear on their web site.
With increased national doppler radar coverage, increasing population, and greater attention to tornado reporting, there has been an increase in the number of tornado reports over the past several decades. This can create a misleading appearance of an increasing trend in tornado frequency. To better understand the true variability and trend in tornado frequency in the US, the total number of strong to violent tornadoes (F3 to F5 category on the Fujita scale) can be analyzed. These are the tornadoes that would have likely been reported even during the decades before Dopplar radar use became widespread and practices resulted in increasingtornado reports. The bar chart below indicates there has been little trend in the strongest tornadoes over the past 55 years.
So itt turns out there is a decent way to correct for this. We don’t think that folks in 1955 were missing many of the larger class 3-5 tornadoes, so comparing 1955 and 2000 data for these larger tornadoes should be more apples to apples (via NOAA).
Well, that certainly is different (note 2004 in particular, given the movie claim). No upward trend at all when you get the data right. I wonder if Al Gore knows this? I am sure he is anxious to set the record straight.
By the way, note the 2nd to last bar, which I believe it the 2008 bar (this chart is really hard to read, but it is the only way I have found the data from the NOAA). In spring of 2008, the media went nuts with a spring spate of tornadoes, saying that the apocalypse was here and this was the ultimate proof of global warming. In particular, ABC ran a story about how the frequency was twice the previous year. Beyond the insanity of drawing long term trends in a noisy system from 2 data points, notice that the previous year was virtually the lowest number in half a century, and despite being twice as high, 2008 turned out to be an average to lower-than-average tornado year. This is what the media does with the climate issue, and why you can trust almost none of it.
Update: By the way, 10 of the top 10 deadliest tornadoes occurred before 1955? An artifact of increasing wealth, better construction, and in particular better warning and communication systems? Likely -- it is no accident, I think, these all occurred before the popularization of TV. However, remember this argument when you see charts of increasing property damage from hurricanes. These are also an artifact of increasing wealth, but the other way around -- more rich people build expensive houses on the beech, the more property damage from hurricanes irregardless of hurricane strength or frequency.
Update#2: The entire outbreak may be the third deadliest in the century.
Wind is not the worst form of alternative energy -- that probably has to go to corn ethanol. But it is close. The consistent experience of European countries that have more wind power than the US is that, because wind is so unreliable, hot backup fossil fuel generation capacity nearly equal to wind capacity needs to be maintained. This means that even when the wind is blowing, it is not reducing fossil fuel consumption in any meaningful way. In other words, billions are spent on wind but without any substitution of existing power sources. Its just pure wasted money.
Anyway, here is a recent study by an environmental group, no less, that found that Britain's wind generation plants are running well under the promised efficiency. That is, of course, when they are even operable and not just broken down. In the latter case, companies go for the quick bucks of up front subsidies, then find that the units are not worth the repair costs when they break.
From the printed version of the Daily Telegraph (does not appear to be online, but scan here).
The days of permanently available electricity may be coming to an end, the head of the power network said yesterday.
Families would have to get used to only using power when it was available, rather than constantly, said Steve Holliday, chief executive of National Grid. Mr Holliday was challenged over how the country would "keep the lights on" when it relied more on wind turbines as supplies of gas dwindled. Electricity provided by wind farms will increase six-fold by 2020 but critics complain they only generate on windy days.
Mr. Holliday told Radio 4's Today programme that people would have to " change their behaviour".
This story is from the WSJ, and gets extra bonus points for including the poster-boy of the corporate state, Jeffrey Immelt
Treasury and OMB singled out an 845-megawatt wind farm that the Energy Department had guaranteed in Oregon called Shepherds Flat, a $1.9 billion installation of 338 General Electric turbines. Combining the stimulus and other federal and state subsidies, the total taxpayer cost is about $1.2 billion, while sponsors GE and Caithness Energy LLC had invested equity of merely about 11%. The memo also notes the wind farm could sell power at "above-market rates" because of Oregon's renewable portfolio standard mandate, which requires utilities to buy a certain annual amount of wind, solar, etc.
But then GE said it was considering "going to the private market for financing out of frustration with the review process." Anything but that. The memo dryly observes that "the alternative of private financing would not make the project financially non-viable."
Oh, and while Shepherds Flat might result in about 18 million fewer tons of carbon through 2033, "reductions would have to be valued at nearly $130 per ton CO2 for the climate benefits to equal the subsidies (more than 6 times the primary estimate used by the government in evaluating rules)."
So here we have the government already paying for 65% of a project that doesn't even meet its normal cost-benefit test, and then the White House has to referee when one of the largest corporations in the world (GE) importunes the Administration to move faster by threatening to find a private financial substitute like any other business. Remind us again why taxpayers should pay for this kind of corporate welfare?
First, the moment GE said that this could be financed privately, the Feds should have said "then what the f*ck are you talking to us for? Get out of here." By the way, privately probably does not mean privately -- it probably means going to private banks or investors who in turn access many of the same taxpayer funds.
Second, its amazing that the threat to finance this privately rather than sponging off taxpayer funds is treated as a threat by the Obama Administration. They desperately want to "take credit" for the project and can only do so by spending our money (this is the same impulse that propels politicians who have never given a dime to charity to want to spend taxpayer money in order to be called "caring.")