That Sinking Feeling

There appear to be at least some members of the media falling off the Obama bandwagon. In an unsigned editorial, the Detroit News blasts the carbon tax proposed by Barack Obama as a dagger aimed at Michigan’s heart.

The carbon tax will be paid by energy companies, manufacturers and public utilities, who will pass the cost on to their consumers. Michigan will be especially targeted. It gets 60 percent of its electric power from coal plants, and the state’s economy is still reliant on heavy manufacturing such as car and truck assembly and auto parts production.

Michigan will lose as carbon tax money is shifted to states with a greater presence of high-tech and service businesses.

The proposed tax would take effect in 2012 and has the very real potential to throw the nation back into recession, if indeed the expected recovery has arrived by then. It’s impossible to raise costs for such basics as manufacturing and energy production by more than half a trillion dollars over a decade and not have the effects felt across the economy.

No, the effects cannot be avoided. They will be drastic. This is nothing more than a huge tax increase that will be devastating on the economy and on the people of this country. Worse yet, the effects of this massive tax hike will be particularly harsh on those who can afford it the least. It is regressive at its very core.

Even the Detroit News sees the one important truth – or lie, depending on how you look at it – of this massive carbon tax: The companies will not pay the cost of it. We will. Each and every one of us who buys, consumes or uses pretty much anything.

Worsening The Crisis

The Wall Street Journal charges that the Obama administration is deepening and widening the financial problems the country now faces.

As 2009 opened, three weeks before Barack Obama took office, the Dow Jones Industrial Average closed at 9034 on January 2, its highest level since the autumn panic. Yesterday the Dow fell another 4.24% to 6763, for an overall decline of 25% in two months and to its lowest level since 1997. The dismaying message here is that President Obama’s policies have become part of the economy’s problem.

Americans have welcomed the Obama era in the same spirit of hope the President campaigned on. But after five weeks in office, it’s become clear that Mr. Obama’s policies are slowing, if not stopping, what would otherwise be the normal process of economic recovery. From punishing business to squandering scarce national public resources, Team Obama is creating more uncertainty and less confidence — and thus a longer period of recession or subpar growth.

I heard an Obama sound bite today dismissing the stock market drops as little more than noise. I don’t think they are. There is real damage being done here. Capital is trying to find a refuge from the announced redistributionist policies of the Obama administration. The economy will suffer. So will the people.

The economic recovery is bound to be damaged by the new policies of the Obama administration. When the energy prices average people pay in this country skyrocket as a result of the Obama cap and trade scheme, the economy will take another hit. When the administration finds that the “rich” don’t exist in enough numbers to fund their plans the “rich” will, inevitably, be defined downward.

I think the WSJ has this one called out right. We are in for a severe – and lasting – economic downturn.

Coal For Christmas

The old warning that naughty children would only get a lump of coal in their Christmas stockings never had much effect on me. We really did not make a big deal about the whole stocking thing in my house when I was growing up. But then, we also exchanged gifts on Christmas Eve, a Norwegian tradition. Or maybe just out Norwegian family tradition. But now, getting coal in your stocking for some folks is a score, not a penalty. The use of coal for residential heating is on the rise.

Burning coal at home was once commonplace, of course, but the practice had been declining for decades. Coal consumption for residential use hit a low of 258,000 tons in 2006 — then started to rise. It jumped 9 percent in 2007, according to the Energy Information Administration, and 10 percent more in the first eight months of 2008.

Online coal forums are buzzing with activity, as residential coal enthusiasts trade tips and advice for buying and tending to coal heaters. And manufacturers and dealers of coal-burning stoves say they have been deluged with orders — many placed when the price of heating oil jumped last summer — that they are struggling to fill.

“Back in the 1980s, we sold hundreds a year,” said Rich Kauffman, the sales manager at E.F.M. Automatic Heat in Emmaus, Pa., one of the oldest makers of coal-fired furnaces and boilers in the United States, in a nod to the uptick in coal sales that followed the oil crises of the 1970s.

“But that dwindled to nothing in the early 1990s — down to as many as 10 a year,” he said. “It picked up about a year ago, when we moved about 60 units, and then this year we’ve already sold 200.”

When my wife and I lived in New York, we bought a lovely, old cobblestone house. It was built somewhere around 1827-1835. It was not a “fancy” cobblestone, with meticulous herringbone stone patterns and had been unoccupied for a number of years before we bought it. It wasn’t all that big, but it was well built with massively thick walls. It also had no central heat.

At some point, a previous owner had installed electric baseboard heaters in the rooms of the house. These cost a fortune to run in winter. My wife and I installed a coal stove insert in the old cobblestone part of the house in the main fireplace and a pellet stove in the newer addition that had been put on at some date.

They worked great. A lot of work, but heat was not a problem. Because of the house layout, natural circulation kept the house nice and warm, no matter how cold it was outside. That coal stove put out some serious heat, too. (We had to have a stainless steel liner installed in the old stone chimney to accommodate the stove.) I burned pea-sized anthracite in the stove. A ton takes up a surprisingly small volume and I built a smallish bin to hold it. Yeah, I had to lug coal and ash on a regular basis, but it wasn’t all that bad. It also kept the house comfortable.

Via Memeorandum

Shocka!

Did Warren Buffett just get out-maneuvered? Electricite de France has just snatched Constellation Energy away from Buffett’s MidAmerican Energy.

The fight over the fate of Constellation Energy Group ended yesterday with a big French utility agreeing to pay $4.5 billion for a half interest in the company’s nuclear power plants and a Midwest utility controlled by Warren Buffett getting $593 million in cash plus a 10 percent stake in Constellation to drop its takeover bid.

The agreement ends a three-month saga during which MidAmerican Energy Holdings rushed in with a $4.7 billion, $26.50-a-share takeover bid for the cash-starved Constellation, only to run into a higher, $35-a-share competing offer led by Electricite de France, the state-owned French utility.

The final accord gives EDF a greater platform to press for new nuclear power plants in the United States. The French firm plans to make Constellation’s proposal for a new unit at the existing Calvert Cliffs nuclear facility a showcase for federal lawmakers.

This is kind of shocking. Frankly, I was a bit shocked when MidAmerican (or, more properly, Buffett) made the play for Constellation. But to see EDF take it away is even more shocking. There will be quite a lot of water cooler talk about this one in the industry.

I was a supporter of nuclear power long before I entered the field (unintentionally). So I welcome the push for more plants, regardless of which corporation is pushing them. EDF has a very good track record at managing their facilities, so it will be interesting to see how this all plays out.

(Sorry if this post is a little “inside baseball”. But it is my field, after all.)

Life With Fluorescent Bulbs

Via Glenn Reynolds, Life with fluorescent bulbs.

The reason I linked this is that my wife and I have compact fluorescent bulbs in the ceiling fan fixture in our living room. We installed them because the fan is very high up – it was a pain to get the ladder out all the time to change incandescent bulbs.

Well, a few days ago one of the bulbs blew out. (Not anywhere near the promised lifespan, mind you. It had been up there less than one year.) So today we got a new bulb.

When we screwed it in and flipped the switch, it began making a loud buzzing sound. It flickered – looking a lot like the Joe Versus the Volcano clip. Then it settled out and worked.

A couple of hours later, the bulb began to buzz again and the light flickered. A lot. I got the ladder back out and swapped it out for another from the package we had bought. That one appears to be working right now.

What does this all have to do with the great scheme of things? Not much. But I also don’t think the CF bulb is going to save the planet.

You Can’t Get Blood From A Stone

But Shell Oil appears to have found a way to get oil from a rock. The Denver Post describes a promising technology to extract oil – a lot of oil – from oil shale in the American West. There are many unanswered questions and many details that need to be worked out, but this is pretty promising. Shell's test site yielded about a 65% recovery rate for the oil. Versus about a 25% recovery rate for traditional methods. The resultant extracted oil is of an extremely high quality.

GARFIELD COUNTY — The ramshackle collection of wellheads and electric cables hidden in a pine-covered draw west of Rifle doesn't look like much now, but until three years ago it was the home of the oil industry's equivalent of the Manhattan Project.

Over five years here, Shell Oil conducted a series of secretive experiments that have the potential to blow open the status quo of North American oil production, unlocking the vast reserves of oil shale that underlie Colorado's Western Slope.

Early attempts failed miserably. But beginning in 2002, Shell drilled a honeycombed series of wells, then lowered in giant heating elements, raising the temperature of the shale to 650 degrees Fahrenheit for 12 months. Out flowed an abundance of high-quality shale oil.

"It was our 'eureka' moment," said Tracy Boyd, a spokesman for Shell, smiling as he showed off the historic spot. "Now we know we have a technology that works."

Now that and similar technologies have become fodder in the increasingly contentious energy debate, holding out the possibility that, in an era of $4-a-gallon gasoline, America might just be sitting on oil reserves equal to a 100-year supply of the country's imports.

The fight over oil shale has become a major issue in Colorado's U.S. Senate race as well as a regular talking point for Republicans nationwide. At the White House in June, President Bush blasted Democrats for "standing in the way" of oil-shale development and hurting ordinary Americans.

The latest to enter the fray is Orrin Hatch, the powerful Republican senator from Utah, who accused Democratic Senate candidate Mark Udall of siding with "an elite, anti-oil crowd" by helping impose a moratorium on commercial leasing regulations for the shale deposits. (Utah is one of three Western states with oil-shale reserves.)

The technology still needs to be proven at an industrial scale and there are serious issues about the environmental impact, especially on water resources. Read the whole thing. The early battle lines are already forming both in the short term of this election and in the long term, decades away. But this appears to be promising. Certainly more promising than this incident over in Zimbabwe.

Canute Get There From Here

Andrew Revkin at the New York Times Dot Earth blog does his best to annotate Al Gore's latest climate hysteria. From the perspective of an engineer who has worked in the utility area, I think Revkin misses an important point. Simply put, Gore has no clue – whatsoever – what he is talking about. None. Take this quote:

To be sure, reaching the goal of 100 percent renewable and truly clean electricity within 10 years will require us to overcome many obstacles. At present, for example, we do not have a unified national grid that is sufficiently advanced to link the areas where the sun shines and the wind blows to the cities in the East and the West that need the electricity.

The fact is, we do have an interconnected grid – or nothing would be working the way it does. The other fact is that the laws of physics dictate how line losses work. It is not possible to transmit power from "where the sun shines and the wind blows" to anywhere all that distant from those places. This has to do with the pure physical constraints of how electricity is produced and transmitted. All those overhead transmission lines have real – and absolute – physical constraints on them. Al Gore cannot wave his magic wand and remove those constraints.

When Gore can pull off what King Canute could not and repeal the laws of physics that govern how things work in the real world, I'll listen to him.

I rahter doubt I'll ever have to.

Traction, Part Two

The Democrats have a real problem. Prior to the holiday recess, they announced how super-confident they were that they had the Republicans in a political corner with their enlightened energy policies. Except they have withdrawn all their big bills from consideration – because the people, bless their hearts – want DOMESTIC solutions that don't count on windy promises.

House Democrats are in a bind on the focal point of their energy plan.

Worried that a floor vote on any energy-related measure would trigger a Republican-forced vote on domestic drilling, the leadership has scrubbed the floor schedule of the energy legislation that it vowed to tackle after the Fourth of July recess.

Just before leaving for their districts, a number of House Democrats called a press conference to declare victory on a number of energy bills — including overwhelming passage of a bill to rein in excessive oil market speculation.

Democrats declared victory on a bill they failed to pass on the suspension calendar — their “use it or lose it bill” to force energy companies to either start drilling on their federally leased land or give it back — saying they had put 176 Republicans on record as siding with the oil companies over consumers.

And they vowed that the bill, the centerpiece of their energy message, would be back.

“We’ve taken some bold steps this week, and we’re going to build on that [after recess] with the bills we take up,” Democratic Caucus Vice Chairman John Larson (Conn.) said at the press conference.

But, as of Monday afternoon, neither “use it or lose it” nor any other energy measure had been scheduled for floor action this week.

Democrats said they were simply taking a different approach to passing their top energy-related priorities.

What is their super-whamadyne strategy? The money quote:

“Right now, our strategy on gas prices is ‘Drive small cars and wait for the wind,’ ” said a Democratic aide.

Larger families – which exist in large numbers – the Democratic strategy leaves out. Those who actually understand the realities of power generation are shaking their heads – trust me on this. Regardless of what your political beliefs are, wind power is available about 30% of the time. Period. Most of the time the wind is either too weak or too strong to produce power.

Politics by wishful thinking is not going to solve the energy problem. Waiting for windy promises is downright stupid. The Democrats are terrified of having to vote an up-or-down "drill now" bill.

Because they would lose.

How Many Orangutans Per Mile?

I have written several posts about the plight of the orangutans. A new study shows just how badly off the great apes are because of the mad rush to produce "biofuels".

New orangutan population estimates revealed in the July issue of Oryx reflect those improvements in assessment methodology – including standardized data collection, island-wide surveys, and better sharing of data among stakeholders – rather than dramatic changes in the number of surviving orangutans.

The experts’ revised estimates put the number of Sumatran orangutans (P. abelii) around 6,600 in 2004. This is lower than previous estimates of 7,501 as a result of new findings that indicate that a large area in Aceh that was previously thought to contain orangutans actually does not. Since forest loss in Aceh has been relatively low from 2004 to 2008, the 2004 estimate is probably not much higher than the actual number in 2008. The 2004 estimate of about 54,000 Bornean orangutans (P. pygmaeus) is probably also higher than the actual number today as there has been a 10 percent orangutan habitat loss in the Indonesian part of Borneo during that period……

…….Although other threats to orangutan survival exist, such as hunting in agricultural areas where human-orangutan conflicts exist, the biggest by far is forest destruction associated with the burgeoning palm oil industry in Indonesia and Malaysia. Together, they are the world’s largest palm oil producers with a combined global market share of 80.5 percent. Rapid expansion of the palm oil industry coupled with poor land-use planning are further pressuring forests and the orangutans who depend on them for survival.

The madness of biofuels. The truth is that biofuels produce more carbon emissions, not less.

Notes From Novak

A couple of interesting items in Robert Novak's column today. First, Wesley Clark may have ruined his chances of being chosen as Obama's running mate with his attempt at belittling John McCain's military experience.

WASHINGTON, D.C. — Retired Gen. Wesley Clark, whose stock as Sen. Barack Obama's possible vice presidential running mate had been rising, may have ruined his chances with his belittling attack on Sen. John McCain's war record.

Clark, along with other Obama surrogates, followed the campaign's line of downgrading McCain's performance as a Vietnam War POW. But Clark was particularly insulting. ("I don't think riding in a fighter plane and getting shot down is a qualification to be president.") He also got more attention by appearing on CBS's "Face the Nation," while other surrogates addressed campaign gatherings.

Even more interesting is an item further down the page:

When Chairman David Obey announced before the Fourth of July break that he was shutting down his House Appropriations Committee's consideration of money bills, House Republican leaders felt they had the Democratic majority on the run over soaring gas prices.

The committee was considering the Labor-HHS appropriation when ranking Republican Jerry Lewis offered the Interior money bill as an amendment to force a vote on oil drilling. "As far as I'm concerned," Obey said as he adjourned the committee, charging Republican obstructionism, "they've had their shot."

The Democrats are desperate to avoid voting on expanding oil exploration. This is a surprise hot-button issue for the Republicans to run on, one that resonates with the majority of Americans who are sick of the price of gasoline. The sky high cost of fuel is causing inflation across the board. Even my local garbage collection service has had to raise prices because of the rise in fuel prices. By a substantial amount.

Wonder Why Food Prices Are Skyrocketing?

I have pointed out for some time now that so-called biofuels are an environmental and economic disaster. Now The Guardian, of all places, reports on a leaked report they have obtained. The report, from the World Bank, says that the biofuels craze has driven the cost of food up by 75%.

Biofuels have forced global food prices up by 75% – far more than previously estimated – according to a confidential World Bank report obtained by the Guardian.

The damning unpublished assessment is based on the most detailed analysis of the crisis so far, carried out by an internationally-respected economist at global financial body.

The figure emphatically contradicts the US government's claims that plant-derived fuels contribute less than 3% to food-price rises. It will add to pressure on governments in Washington and across Europe, which have turned to plant-derived fuels to reduce emissions of greenhouse gases and reduce their dependence on imported oil.

Senior development sources believe the report, completed in April, has not been published to avoid embarrassing President George Bush.

"It would put the World Bank in a political hot-spot with the White House," said one yesterday.

It isn't the White House, really. It is Congress and European governments that have driven this madness. (No, I am not letting the White House off the hook, either.) Biofuels are nothing more than a grossly inefficient energy transfer scheme – and a way for vested interests to make huge profits off the backs of the people.

There have been many voices raised against the insanity of biofuels, but Europe and the United States keep blindly riding the biofuel bandwagon.

"Without the increase in biofuels, global wheat and maize stocks would not have declined appreciably and price increases due to other factors would have been moderate," says the report. The basket of food prices examined in the study rose by 140% between 2002 and this February. The report estimates that higher energy and fertiliser prices accounted for an increase of only 15%, while biofuels have been responsible for a 75% jump over that period.

Speculators and special interests are making things worse. It has never been easier to rape the planet than it is today. Just say you're "saving the planet" and you have a license to destroy. The human cost of biofuels is too high. It is time to stop this madness.

Jobs. Good Ones.

Patrick Moore, a founder of Greenpeace, has been mentioned here at Blue Crab Boulevard several times in the past. Moore is now an eloquent spokesman in favor of nuclear power. He is now the co-chair of an advocacy group called the Clean and Safe Energy Coalition, or CASEnergy. They have just released a report detailing the economic impact a "nuclear renaissance" would have. Basically, lots and lots of extremely good jobs would be created.

Currently, 17 companies and consortia are considering around 30 new reactors in the United States. This new era of nuclear energy will translate into tens of thousands of jobs created to construct,maintain and support new reactors.

Both plant construction and operation will create thousands of jobs in communities surrounding the plants. Depending on the building technique selected, the Nuclear Energy Institute (NEI) anticipates new reactors planned will require tens of thousands of workers for construction,engineering and project management —as many as 4,000 per project at peak periods.

These are high-paying jobs, many of them are union jobs. And the plants produce enormous economic benefit for their localities. Existing plants currently inject large amounts of money into the local economy:

Already, each reactor generates an estimated $430 million a year in total output for the local community, and nearly $40 million per year in total labor income.

That money creates a cascade throughout the region the plants are situated in. The full white paper can be downloaded here.

The thing is, this will produce more than just nuclear jobs. Huge amounts of construction material will be required. Pumps and valves, piping and cable, concrete and steel. All will provide opportunities for manufacturers to expand their facilities and workforces. Abundant energy will, in turn, allow other sectors of the economy to flourish. It is worth reading this paper if you're worried about the economy and jobs.

Traction

Robert Novak notes that Congressional phone lines have been going berserk over a surprise hot-button issue. People are backing Republican calls to "Drill NOW!"

Members of Congress were swamped by telephone calls and e-mail messages Thursday demanding, "Drill now!" in response to a Republican call for increased American oil production to fight runaway gasoline prices.

Lawmakers got little response to previous proposals intended to lower the cost of oil: alternative energy sources, a federal gasoline tax holiday, an excess profits tax on U.S. oil producers and pressure on foreign oil producers. In contrast, the demand to "drill now" (first urged this year by former House Speaker Newt Gingrich) has taken hold.

Our politicians had better pay attention to this one, this could be extremely damaging to Democrats if they continue to stonewall drilling for oil here in this country. This could also be a massive boost for Republicans in November. So far, the "Drill NOW!" support is coming from Republican lawmakers. Democrats ignore this at their own peril.

Washington's stupid energy policies are directly responsible for the promotion of pie-in-the-sky ethanol and the refusal to allow drilling for known reserves of billions of barrels of oil in our own territory. It's time to send a message to Congress. Call your lawmakers and make sure they hear your views. Drill NOW!

Looking Green

As opposed to actually being green. The Washington Post notes that most of the highly publicized ways of "fighting" climate change are completely useless – or very nearly so. Instead they are more of a fashion statement.

In March of last year, the World Wildlife Fund in Australia teamed up with Leo Burnett, the multinational advertising agency that created the Marlboro Man, to come up with a new environmental campaign called Earth Hour. The idea was to get 2 million residents in Sydney to turn off all the lights in their homes for one hour. The campaign generated wide publicity, but the energy saved was small — the equivalent of taking about five cars off the city's roads for a year.

This year, Earth Hour expanded to dozens of cities around the world. The Golden Gate Bridge in San Francisco, the Sears Tower in Chicago and the Empire State Building in New York were among the U.S. landmarks that went dark. Many corporations signed on to burnish their green credentials. A bar in Phoenix served a drink called an ecotini — organic vodka, green tea and an edible orchid.

But if everyone who participated in Earth Hour had left their lights on and instead switched to mundane, high-efficiency compact fluorescent bulbs, simple calculations show, it might have saved 1,368 times as much energy, because the bulbs would have saved energy all year…..

….."It is very difficult to get people to invest in home insulation and energy efficiency, which are much more effective than putting solar panels on your roof," he said. "Solar panels are popular because you can see you are doing something — and your neighbors can see it, too."

Greenier than thou rules. Style over substance. Just as Al Gore preaches carbon neutrality while consuming vast quantities of energy. The official in charge of the Earth Hour initiative for the WWF admits that the whole thing is designed to manipulate people:

"You are not going to get people to change what people do by engaging their heads; you have to engage their hearts," she said. "You need symbols to spur action. You are not going to get people to take action unless you get them to care about the issue. You are not going to do that by pulling out the U.N. report on blah, blah, blah."

Very nice. It's really about a political agenda.

Who’s Paying For All This?

Why, you and I are, of course. The Wall Street Journal takes a look at the way the Federal government subsidizes energy production in the United States. It's appalling.

Some clarity comes from the U.S. Energy Information Administration (EIA), an independent federal agency that tried to quantify government spending on energy production in 2007. The agency reports that the total taxpayer bill was $16.6 billion in direct subsidies, tax breaks, loan guarantees and the like. That's double in real dollars from eight years earlier, as you'd expect given all the money Congress is throwing at "renewables." Even more subsidies are set to pass this year.

An even better way to tell the story is by how much taxpayer money is dispensed per unit of energy, so the costs are standardized. For electricity generation, the EIA concludes that solar energy is subsidized to the tune of $24.34 per megawatt hour, wind $23.37 and "clean coal" $29.81. By contrast, normal coal receives 44 cents, natural gas a mere quarter, hydroelectric about 67 cents and nuclear power $1.59.

This is our tax money being glad handed away by Washington. The numbers for biofuels are equally bad:

The same study also looked at federal subsidies for non-electrical energy production, such as for fuel. It found that ethanol and biofuels receive $5.72 per British thermal unit of energy produced. That compares to $2.82 for solar and $1.35 for refined coal, but only three cents per BTU for natural gas and other petroleum liquids.

If the subsidies for all sources of energy were taken away, which technologies would survive? That should be obvious. This isn't even taking into account the fact that fossil plants have to back up wind and solar power and be ready to take up the load when those sources drop offline suddenly. This was illustrated last February in Texas.