Just One More Reason Why Fossil Fuels Suck Tailpipe — The Cost of Wind and Solar is Now Lower Than Pretty Much Everything Else

During October, in Australia, something rather strange and hopeful happened. Grid prices for electricity rose. Power customers, fed up with this, en masse decided to purchase 100 megawatts of rooftop solar in a single month.

How and why did this come to pass?

Conservative allies of fossil fuel based utilities are currently in control of the Australian federal government. And they have been working to provide captive grid-tied energy consumers for their political backers — polluting power system owners. Because these systems are more expensive than their renewable energy counterparts, the price of electricity went up.

The Australian public, who generally supports renewables and who likes to pay less for electricity, wouldn’t have any of it. They didn’t like being forced to purchase more expensive, polluting energy. So more than 15,000 of them decided to tell fossil fuel backers to go suck tailpipe and went on ahead and bought solar energy directly.

(Guess what? That green glass you see on the school in this image comes from hundreds of solar panels. Solar is versatile and increasingly inexpensive. You can put it on rooftops, building sides, car roofs, fuel station overheads, build it in traditional utility arrays, construct it on co-generating farms, or float it on reservoir surfaces. Image source: Inhabitat and EPFL.)

This choice, enabled by falling renewable energy prices, is one that people around the world will be more and more able to make as time moves forward. And it’s the case even in instances where national governments of western democracies are heavily influenced by fossil fuel special interests — as is presently the case in Australia. The primary reason is that when conservative governments support fossil fuels and nuclear over renewables, power prices to society rise.

The cost of both wind and solar energy are now less than every traditional power source even in more mature markets like the United States. In this major market, according to Lazard, the levelized price of nuclear is 14.8 cents per kWh, coal is 10.2 cents per kWh, gas is 6 cents per kWh, solar is 5 cents per kWh, and wind is 4.5 cents per kWh. That’s right. Renewables are about 1/3 the price of nuclear, half that of coal, and 10-20 percent less than gas in the U.S.

 

(The levelized cost of wind and solar energy keeps falling. This is making continued fossil fuel development an expensive and untenable prospect. Image source: Lazard.)

But in places like Australia and in the developing world, this price difference is even greater. In the developing world, there are less legacy fossil fuel power systems — which makes it a no-brainer just to go ahead and build less expensive renewables. And islands like Australia traditionally suffer from higher import costs for fossil fuels and clunky or inefficient fossil fuel energy system components.

Levelized cost is a way of measuring total life-cycle costs. It includes such costs as fuel, transmission and construction. Because renewables do not require fuel and because they are based on technologies that benefit from both advancement and economies of scale, they are able to continuously increase efficiency and reduce cost over time. Fossil fuel based power systems are mated to very inefficient combustion and to mining and extraction of fuels that grow more scarce over time. As such, the power systems they are based on tend to have difficulty reducing costs  and are subject to market shocks and scarcity of feedstocks.

These simple economic facts put the political backers of fossil fuels at a disadvantage on the issue of base economics. But these direct cost related factors don’t even begin to count in the terrible external costs of fossil fuels ranging from ramping damages due to climate change and direct health impacts by adding toxic particles to the air and water. As such, fossil fuels are both economically and morally untenable. But such simple and easy to understand facts haven’t stopped republicans like Trump in the U.S. and LNP members like Turnbull in Australia from trying to ram these harmful and expensive energy sources down the throat of an increasingly outraged public.

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Trump’s Promise to be America’s Most Dangerous, Divisive President

Today, both President Obama and President-Elect Trump have urged America to keep calm and united. But despite these overtures, many Americans are experiencing a sensation akin to shock following one of the nastiest, most vitriolic elections in American history. One in which Trump repeatedly scape-goated women and minorities in a bald attempt to pander to some of the most harmful social undercurrents existing in our country.

Given the ugly tone of Trump’s campaign and his loss in the popular vote by 200,000 and growing despite apparent wins in the electoral college, Americans and people abroad alike now feel a very valid sense of deep concern for the future of a fractured Nation and an increasingly threatened world. For what Trump has pledged and promised to do during his Presidential campaign represents a very real risk of severe political, climatalogical, physical, and economic harm for this country, her people, and to the people and living creatures of this world.

(Berkley students chant ‘not my President!’ in protest walk out on November 9th. Across America and the world, similar protests were underway. Michael Moore, meanwhile, was urging continuous acts of civil disobedience in opposition to Trump’s election. Currently, over 100,000 people are protesting in New York City alone.)

Disturbing Threats to Jail Political Opponents

Threatened with incarceration for presumed crimes no-one has convicted her of, Hillary Clinton must be among those feeling the shock. Trump threatened to jail her if he was elected President. And many of his followers took up the cry — posting ‘jail Hillary’ signs on the sides of roads or demanding unjust incarceration of a political opponent loudly on twitter.

Unfortunately, if Trump’s current diplomatic demeanor spoils, these election campaign threats could very easily turn real. Trump has the power to appoint a special prosecutor. The power to appoint an Attorney General who agrees with his views. The power to, in effect, ‘rig’ the judicial and prosecutorial system to favor his opinion that Hillary should be jailed.

Trump’s uttering of these words during the campaign has already been deeply damaging. Never before in modern memory has one U.S. Presidential opponent publicly threatened to jail another. But carrying out such an action would be as unprecedented as it would have a terribly chilling effect on U.S. democracy.

An Angry Finger on the Nuclear Button

As Clinton reflects on Trump’s threats to haul her off to trial, others around the world are looking fearfully back at the rage-filled rhetoric of a man who is soon to be equipped with the full might of America’s considerable arsenal. During the campaign, Trump claimed to ‘love war,’ asked, multiple times, during security briefings why the U.S. doesn’t use nuclear weapons, and pledged to ‘bomb the shit’ out of Isis and steal their oil. He’s expressed a desire to turn NATO into a protection racket meant to extort fees from allies. And he’s shown a disturbing affinity toward other aggressive leaders like Vladimir Putin.

If Trump’s belligerence and seeming lack of sense continues post-campaign, there’s a valid concern that he might order a nuclear strike with little in the way of provocation. The President does hold the nuclear codes. And though aides, advisers and a substantial military chain of command provide a buffer between a bad decision and disaster, the fact that a hot-headed Trump ignorant to the devastating consequences of the use of such weapons is the final say in the matter is a serious worry.

Killing Climate Treaties, Promoting Fossil Fuels

As nations around the world look to the U.S. with fear and concern, a number of climate bad actors stand to be empowered by a Trump Presidency. Trump has effectively pledged to cut all funding to climate science and renewable energy research and development. In one fell swoop, this action would remove NASA and NOAA’s ability to track climate change even as the main competitors to fossil fuels — wind, solar, and vehicle battery technology — are effectively stymied. It’s a 1-2 punch that would dramatically harm this nation’s already flagging resilience to a rapidly worsening global climate crisis.

Meanwhile, his board of energy advisers are hand-picked from these bad actor fossil fuel companies and include a long list of climate change deniers. Trump has pledged to bring back coal while heightening U.S. oil and gas production and consumption. He has also promised to kill Obama’s Clean Power Plan, de-fund the EPA, and back out of the Paris Climate Treaty.

earth-under-fire

(Trump, according to Joe Romm over at Climate Progress, appears likely to go down in history as the man who single-handedly pulled the plug on the potential for a livable climate. I agree with Joe’s lucid but stark assessment — without some kind of significant outside action, we are in a very tough spot now due to this set-back by Trump. We really have been given no rational cause to hope otherwise. Image source: Ring of Fire Network.)

Combined, these actions would have a devastating effect on the currently building but still not sufficient global response to climate change. Backsliding by the U.S. will likely also cost reduced commitments by such varied states as India and China even as other countries like the UK, Australia, and Canada are likely to take U.S. climate inaction as their own excuse to renege on past emissions reduction goals.

Overall, a Trump Presidency that follows through on its anti-stable-climate agenda could cost the world as much as 1-2 C in additional warming this Century (on top of what’s already locked in) by keeping the U.S. and other nations on a business as usual emissions path longer and essentially dismantling much of the progress that was achieved under the Obama Administration. To be very clear, current bad climate outcomes are occurring under just 1 C above 1880s level warming. Meanwhile, greenhouse gas reduction commitments under Paris are setting the world on a path to about 3 C warming by the end of this Century. Trump’s policies, when all is said and done, could easily push that to 4 C or more — which would be utterly devastating.

Prospects for escalating climate policies to achieve a less than 2 C warming this Century are now also pretty bleak as Trump rolls in. In my opinion, it would take a wholesale rebellion by energy investors through the necessary act of divestment in fossil fuel industries and reinvestment in renewables to achieve this goal — first by sapping the political power of the agencies that keep putting people like Trump into office and also by removing capital for current and future projects.

David Roberts over at Vox is rather less sanguine:

The truth is, hitting the 2-degree target (much less 1.5 degrees) was always a long shot. It would require all the world’s countries to effectively turn on a dime and send their emissions plunging at never-before-seen rates.

It was implausible, but at least there was a story to tell. That story began with strong US leadership, which brought China to the table, which in turn cleared the way for Paris. The election of Hillary Clinton would have signaled to the world a determination to meet or exceed the targets the US promised in Paris, along with four years of efforts to create bilateral or multilateral partnerships that pushed progress faster…

 That story is gone now. Dead. The US will not provide leadership — it will be an active, and very powerful, impediment. Under unified Republican leadership, progress on lowering emissions in the US will halt and reverse and US participation in international efforts to combat climate change will cease.

Deregulation + Trickle-Down Isolationism is Bad Economic Policy

Following the Great Recession, Obama and a number of effective economic leaders managed to save the world from complete financial disaster. Helpful polices by Obama and the democrats, including the maintenance of Wall Street oversight, now serve as a thin veil protecting the U.S. and the world from another financial collapse. However, Trump’s pledges to bring back pretty much all of the failed republican economic policies promoted by the Bush Administration that were so destructive while adding still more of his own trouble to the brew risks severe economic consequences.

Trump has pledged to deregulate Wall Street — enabling economic bad actors to have the same free reign that set up conditions for the financial crash back during 2008. He has threatened trade wars with China and other partners — a policy that would have a chilling impact on global markets. He and his republican allies have promoted policies that would hobble the Federal Reserve in ways that would deeply undermine the national economy. And he has promised to produce a massive tax cut for the wealthy while slashing supports for the faltering middle class and poor in this country — further worsening the systemic inequality that has already so deeply harmed and divided our nation.

Economist Paul Krugman is not optimistic — warning of a global recession arising from a Trump Presidency:

Under any circumstances, putting an irresponsible, ignorant man who takes his advice from all the wrong people in charge of the nation with the world’s most important economy would be very bad news. What makes it especially bad right now, however, is the fundamentally fragile state much of the world is still in, eight years after the great financial crisis… So we are very probably looking at a global recession, with no end in sight. I suppose we could get lucky somehow. But on economics, as on everything else, a terrible thing has just happened.

While the threat of a new global recession may not be immediately imminent, Trump’s overall economic stance doesn’t provide much in the way of benefit to anyone but the super-rich while adding to the risk that bad actor financial agencies will again crash the markets at some near or long term future date.

Building the Wall

Related to this likely damaging set of economic views is Trump’s continued pledge to deport millions of Hispanics while erecting a physical barrier between the U.S. and Mexico. Following through with the promise would turn the U.S. into a closed society for the first time in its history as a nation even as it risks the economic collapse of a country along our southern border. And just the expectation of fallout after Trump’s election today has already sent the Peso into free-fall.

Historically welcoming to immigrants, U.S. innovation and competitiveness has been driven by a constant influx of new people, new cultures, new ideas. Trump, like the rest of us, hails from immigrant roots. Following through with such a walling off of our neighbors and the creation of a ‘fortress America’ would steer away from a policy of openness to neighbors that has lasted for the better part of two Centuries. And while trade agreements with Mexico should certainly be managed to keep the needs of the American people (and not international corporations) firmly in mind, a wholesale shutting off of our relationship with that large and developing neighbor would ultimately be harmful to U.S. interests.

No Electoral Mandate

In the spirit of unity, I’ve done my best to strike a conciliatory tone. But this is difficult when there is so much at stake and when so many greedy corporate hands are now ready to manipulate majority republican congressmen, senators, and the President. To be very clear, Trump lost the popular vote to Hillary. So this country didn’t elect Trump. As with Bush in 2000, the electoral college did the deed. This means that more people in this country wanted Hillary’s presidency and policies than those who wanted Trump’s agenda. As a result, Trump can claim no solid electoral mandate.

Overall, despite a pause in the hostilities coming from Trump, severe underlying policy dangers present themselves from a Trump Presidency. An enabling majority in Congress amplifies the risk that these dangerous policies will emerge and that an electorate that has been at least somewhat disenfranchised by Gerrymandering, voter suppression on the part of republicans, and overall intimidation and abuse, will continue to generate harmful and worsening fractures in American society. As with everything else, a worsening climate crisis further threatens to exacerbate these problems even as it generates serious issues all on its own. And the ushering in of yet one more climate change denier into office only serves to create more of a disconnect with public desires for renewable energy access and climate change related action.

Overall, this is a tragic day for America and the world. One with ever-more threatening clouds on the horizon.

Links:

Donald Trump Could Jail Hillary Clinton

Exxon Concedes it May Need to Declare Lower Value for Oil in the Ground

Economic Fallout From a Trump Presidency

Trump Lost the Popular Vote

Trump Already Having a Damaging Effect on Mexico

Hat tip to Colorado Bob

Hat tip to Climate Hawk

(Note this is RS post #1000. One that will live in infamy.)

Record Drop in Coal Burning Raises Question — Is Peak Fossil Fuel Use Happening Now?

Peak oil, gas, and coal.

It’s a possibility that many who believe the fossil fuel industry’s false dependency mantra look at with fear and trembling. Because, for years, that industry, through various public relations efforts, has perpetuated a myth that a loss of access to fossil fuels would ruin the modern global economy. That fossil fuels were so high-quality no other energy source could effectively replace them.

It’s a myth that, in many ways, competes with the threat of human-caused climate change for space in the public’s collective imagination. One that is not without a few valid supports. For the shifting of energy use away from one set of sources and on toward another set is a massive, disruptive undertaking even in the case where the new energy sources are superior to the old.

November Through April 2015 2016

(This is what a real existential threat to global civilization looks like. From the 1880s to the six month cold season of 2015-2016, global temperatures warmed by 1.38 degrees Celsius. At the end of the last ice age, it took about 3,000 years for as much warming to occur as human fossil fuel burning has achieved over just the last 136 years. Dealing with what is a problem of geological scale ramping up with lightning speed will require a necessarily rapid reduction to zero fossil fuel burning over the coming decades. Recent swift curtailments of coal use provide some hope that such a reduction may be possible. But rates of fossil fuel use will have to peak soon and be cut even more swiftly to prevent a very rapidly intensifying global emergency. Image source: NASA GISS.)

But despite a few reasonable worries, the overall effect is to generate a decoy existential threat to the very real threat of a new global mass extinction event if fossil fuel burning isn’t somehow halted in very short order. One that removes innovative thinking and generates a false impression that there really is no way to effectively mitigate and respond to the impacts of an ever-worsening long climate emergency.

The World Health Organization implicates fossil fuel based carbon emissions as one of the greatest risks to human health this Century stating:

Climate change is among the greatest health risks of the 21st Century. Rising temperatures and more extreme weather events cost lives directly, increase transmission and spread of infectious diseases, and undermine the environmental determinants of health, including clean air and water, and sufficient food.

At the same time, many of the same policy and technology choices that drive climate change, such as polluting energy sources and unsustainable transport systems, also have large immediate and local health impacts – most notably the more than seven million deaths that are caused each year by air pollution (emphasis added).

Given what is a very real danger to human health and well-being arising out of the practice of burning fossil fuels coupled with potential human civilization collapses due to severe climate change, sea level rise, disruptions to the growing season, and extreme weather, it’s worth considering the notion that a functional world without them is not only possible — it is absolutely necessary. For shift away from what some have called energy sources from hell and we open up the potential to expand prosperity, to increase prospects for not just the rich, but for practically everyone. For by doing so we shift away from fuels that result in severe systemic harms in a transition to new, less damaging, more distributed and democratic fuels.

And with a massive curtailment of coal energy use, with a rapidly growing adoption of renewables, and with increasing challenges to growth in natural gas and oil consumption all showing up during 2015, it appears that just such a shift may have already started.

*****

Today’s harbinger of what may well now be an ongoing massive move away from harmful fossil fuel energy is itself a bit ironic. For the message comes in the form of a new report out from the fossil fuel giant British Petroleum. And it’s a real eye-catcher. For this fossil fuel industry based report found that global coal use fell by the largest margin ever recorded. With oil and gas struggling to make up the difference, with the fortunes of renewable energy on the rise, and with fossil fuel energy use growing at a very sluggish net annual rate of about 0.56 percent, we’ve got to ask the question — have we reached the age of peak fossil fuels? And, if so, why isn’t the world economy falling apart as some predicted?

Record Drop in Coal Use

The big shock comes in the form of a massive 1.8 percent annual drop in coal use globally. Lead by China and the US, total global coal curtailment reached 71 million tons of oil equivalent during 2015. This was the greatest single annual drop in coal use in the entirety of the 50 year BP record.

Plummeting Coal Use

(According to fossil fuel industry giant, BP, global coal use fell by its largest margin ever. Image source: Carbon Brief.)

The massive drop in coal also occurred at a time when prices for the carbon-emitting commodity were at or near historical lows. A situation that would normally stimulate demand — all other things being equal.

But with coal, all things are not equal. China suffers from some of the worst air and water pollution conditions in the world due to its reliance on the stuff. Its people are getting sick from emissions particulate related lung damage and from coal-based water contamination. Many are dying prematurely as a result. And since coal use is the greatest contributor to China’s air and water woes, China has undertaken a massive effort to curtail its burning.

Globally, coal is also the worst fossil fuel contributor to Earth System warming on a pound-burned for pound-burned comparison. With global temperatures now hitting near the 1.3 C above 1880s temperature marks on an annual basis — a level high enough to begin to inflict severe climate change related harms — world leaders are increasingly feeling the heat to cut coal.

No Global Recession, But Fossil Fuel Use Stagnates

Curtailment of coal use on such a large scale due to climate, health, welfare, and environmental concerns is unprecedented. In the past, large drops in coal use have only occurred during times of economic recession or when another major fossil fuel source such as natural gas out-competed coal on the global market. During this year of greatest coal losses, neither was the case. Coal remained competitive with natural gas on a cost vs cost comparison basis during 2015 even as the global economy grew by about 3 percent according to International Monetary Fund estimates.

Global Growth International monetary fund

(Despite stagnating fossil fuel use and plummeting rates of coal use, the global economy grew by 3.1 percent during 2015. Image source: The International Monetary Fund.)

Coal’s loss also comes in the context of a declining fossil fuel share in the global energy mix. According to BP, fossil fuels accounted for only 86 percent of global energy use — which was the lowest level ever recorded. Non fossil fuel interest sources such as the recent REN21 paper on the global state of renewable energy put that number even lower — close to 80 percent.

But the BP numbers look bad enough from the fossil fuel industry perspective. Globally, both gas and oil use increased by a combined 134 million tons of oil equivalent. A gradual rate of growth that follows historical lines for those two sources. However, when you account for the loss of coal, net fossil fuel energy use only grew by 63 million tons of oil equivalent — and that represents just a 0.56 percent annual rate of growth for the fossil fuel sector. This compares to a historical annual growth rate in fossil fuel use of 1 to 3 percent during non recession years.

Peak Fossil Fuel Use as Boon Not Bane

Rising rates of renewable energy adoption are the primary reason for coal’s fall and fossil fuel stagnation. Globally, according to BP figures, the net add in non-hydro renewables energy use was equivalent to 48 million tons of oil. A number that, if BP is correct, is nipping away at fossil fuel market dominance by achieving a rate of adoption similar to that of a mainstream energy source.

Renewables Rise Fossil Fuels Stagnate

(Renewable rise while coal plummets, dragging down fossil fuels’ overall share of the global energy supply during 2015. Image source: Carbon Brief.)

Falling rates of overall energy gain for fossil fuels may well represent the start of a period when oil, gas, and coal begin to go into net decline. This has not happened yet. But it will be necessary if the world is to have much hope of preventing extremely catastrophic rates of warming by greater than 2 C above pre-industrial levels this Century. So the big coal curtailment during 2015 as the global economy continued a 3 percent annual growth rate was a huge step in the right direction. But to prevent a future in which ever-more-harmful rates of warming occur. In which 3 C, 4 C, or even 5 C warming becomes likely during this Century, then we will need to continue seeing renewables advance. Then we will need to see what would be a benevolent peak in fossil fuel use. One that is coming on a bit late for comfort and that couldn’t happen soon enough.

Links:

BP — Coal Use Fell By Largest Recorded Margin in 2015

The International Monetary Fund

Choose Between Fuels From Hell and Renewable Jobs Economy

Renewables Global Status Report

NASA GISS

Obama Team Not Open to Carbon Tax? So How Best to Move Forward on Climate Change?

Today, White House spokesman Jay Carney at a press briefing told reporters that the Obama Administration would not consider a carbon tax to help reduce US carbon emissions. Carney stated:

“We would never propose a carbon tax and have no intention of proposing one. The point the president was making is that our focus right now is the same as the American people’s focus, which is on the need to extend economic growth, expand job creation.”

Carney then went on to talk about how the Administration was primarily focused on US jobs creation efforts and that any climate change measures would have to fit into the larger jobs growth and economy puzzle.

Unfortunately, Carney seems to think that the notion of a carbon tax and economic growth are incompatible. A notion the 75 billion dollar and growing disaster that was Superstorm Sandy, an idea the 75+ billion dollar drought in the heartland, both well belie. A notion that the, ever-increasing, cost of fossil fuel extraction also drastically undermines. But Carney is, likely, just denying republicans and others who support low tax rates for the wealthy a way to transfer more of the tax burden onto middle and lower income Americans.

In recent weeks, it appears republicans were tinkering with the carbon tax as a means to increase the tax burden for working Americans while lowering it for the wealthy. And this is an effort to certainly be avoided. The problem lies in just how a carbon tax would be implemented. Would it be, primarily, a punitive tax on energy consumption? In such a case, it would almost certainly harm the prospects of working Americans, unless, of course, the taxes were re-invested in the economy in a way that benefited workers and middle class families.

With world climate agencies noting that civilization-wrecking climate impacts emerge if we burn just 20-30 percent of the world’s current fossil fuel reserves, it does, indeed, appear that a major disincentive for burning fossil fuels should be in the offing. And that such a disincentive would preserve the possibility of growth and prosperity, rather than undermine it.

If the Administration were to re-consider the notion of a carbon tax, they could very well employ such a tax in a growth neutral or even pro-growth fashion. In a way that didn’t harm working families, but helped. In such a case, the tax would not just be punitive, it would be an incentive. James Hansen’s tax and transfer plan would result in a carbon tax at the well-head or point of sale being directly transferred to individuals as a subsidy. The result would be, on the one hand, increasing carbon costs, and, on the other hand, money in the pockets of Americans incentivized to purchase low or no carbon fuels and technologies. The result would be a gradual phasing out of carbon based energy without an overall punitive impact to US growth. If transfer is an unsavory notion for politicians, then the money generated from taxes could be directly invested in renewable, zero-carbon, energy systems and in re-training programs for persons who may lose their jobs in high-carbon industries. Such programs would both create new jobs and reduce or eliminate losses from old industries.

The fact that such basic notions aren’t obvious is somewhat disconcerting. Loss of coal mining jobs, for instance, may be a forgone conclusion. But if these workers can be re-trained to work on wind and solar facilities, then the result is a net gain. Especially when you consider the fact that each renewable energy dollar spent results in three times the amount of jobs stimulus as each fossil fuel dollar spent. Such increases in labor may not result in the kind of concentrations of profits as the old oil and coal industries. But the effects of such wealth hoarding have already proven very damaging to the US economy as a whole.

That said, and to the Obama Administration’s credit, they may well be attempting to avoid maintaining lower tax rates on the wealthiest Americans through the vehicle of a carbon tax. And, in such a case, it is obvious why that kind of trade-off should be avoided.

However, if a carbon tax is off the table, there are a number of other measures that can still be pursued. Below are just a few examples:

Renew the Production Tax Credit

The first would be the immediate renewal of the production tax credit for wind and solar energy. Preferably, this renewal would be for a full decade. Such a long-term renewal would provide stability for the growing US wind and solar industries and spur investment in these key technologies, keeping the rate of adoption high. Growth in these critical industries would result in a powerful engine for generating new jobs.

Cut Tax Incentives for the Fossil Fuel Industry

Over 40 billion dollars in tax incentives have gone to the oil and gas industry. Yet the industry continues to produce record profits. Given this clear math, such incentives are entirely unnecessary and wasteful.

Provide Subsidy and Incentive For Smart Grid and Energy Storage

Thousands of jobs could be created through wise investments in both a smart grid and in powerful new energy storage technologies. Both will be necessary if we are to smoothly handle a growing portion of our energy coming from renewables. This powerful new infrastructure will serve as a mechanism to enhance economic growth for decades to come.

Establish a Climate Mitigation and Adaptation Fund

Set aside a portion of savings from winding down the war in Afghanistan, from levelized military spending, and from removing tax incentives for the fossil fuel industry for two purposes. The first would be for direct investment in critical new clean energy technologies (wind, solar, evs, low-carbon farming, new energy systems, economic and non-damaging carbon capture). The second would be for hardening the nation’s infrastructure to the potential new harms caused by climate change. Research into new farming techniques more adapted to a drier climate and deployment of more resilient coastal infrastructure are examples. Care must be noted that mitigation should receive equal or greater funding as it is impossible to adapt to the worst instances of human caused climate change.

Retraining Initiatives for New Industries

Provide funding for individuals who have lost their jobs to train in critical new industries related to mitigating climate change, responding to climate emergencies, and to adapting to a changing climate. Funds should be targeted to jobless college graduates and to workers who lose their jobs in fossil fuel based industries. A portion of this funding would go to establishing relationships with new industry players and facilitating employment.

Establishing Wind and Solar Energy Corridors in Farm and Fossil Fuel Country

Provide incentive for the development of alternative energy in areas where economies were previously dominated by fossil fuels. This diversification would result in economic resilience in these regions, providing a source of new jobs and added stability. Particularly critical is developing these new energy sources for the Appalachian region where workers have been victimized by exploitative coal barons such as Massey. Also useful would be the development of clean energy technologies in farming regions. The result would be the preservation of lands used for food production as well as providing a safety net for these regions in the event of extended harm to farming due to drought.

Use the EPA to Regulate and Reduce Carbon

Provide base-lines for carbon reductions from key industries via the EPA. Increase these base-lines over time. Use the EPA to provide efficiency standards for appliances, vehicles and other equipment. Push efficiency standards higher over time.

Provide a Fund For Renewable Energy Laboratories at the Nation’s Public Schools

Invest public money in incentivizing purchases of solar panels for public schools. Establish science curriculum at these schools that involve students directly in the management of the school’s solar energy resources. Teach the science of clean energy and environmental stewardship at these schools.

Provide and Maintain Tax Incentives for Home Owners and Businesses to Install Solar Panels, Purchase Electric Vehicles

Set aside monies that incentivize the installation of solar panels for US homes and businesses. Set aside and maintain similar incentives for electric vehicles.

Shut Down Dirty Coal Plants, Sell Public Land Coal, Fossil Fuels at Higher Prices

About 6% of US electricity production comes from old, dirty plants. Use the EPA to rapidly phase these plants out. Furthermore, many fossil fuel companies purchase mining rights for US coal, oil, and natural gas on public lands at a pittance. Increase the royalty payments required to access those resources.

Remove Regulatory Hurdles for the Installation of Wind and Solar on US Homes and Businesses

In many regions, the regulatory hurdles for installing wind and solar for US homes and businesses is punitive and prohibitive. Remove these hurdles to increase the rate of home owner and business new technology adoption.

Require that all New Homes and Buildings include Solar

Requiring that every new home and building in the US include solar energy systems would greatly enhance solar energy adoption in the US.

Require EV Recharge Station Installation for all New Streets and Parking Lots

Requiring that all new parking facilities and refurbished streets require EV charging stations would rapidly increase the adoption potential for US electric vehicles.

Set a Carbon Tariff on Goods Produced by High-Carbon Economies Coming Into the US

Set a tariff on goods produced by countries with high-carbon economies. Provide exceptions if those goods come from facilities that switch to low-carbon or zero carbon energy sources. Such a carbon tariff would help to leverage the US’s strength as importer to reduce global carbon emissions.

These are just a few initiatives that could be pursued that will incentivize US jobs growth while also resulting in the rapid deployment of high-efficiency and zero-carbon technologies.

UPDATE:

It appears that the climate blogosphere is somewhat abuzz with outrage over Obama’s not supporting a carbon tax. There’s some good discussion on the issue here:

http://thinkprogress.org/climate/2012/11/16/1206321/new-york-times-slams-obama-for-lame-flip-flop-on-economic-benefit-of-climate-action/

Mitch McConnell Fails in #1 Goal: Defeat Obama; US Electorate Rejects Extreme Republican Obstructionist Agenda in 2012 Election

Last night, Republicans were dealt a severe loss. They received a terrible drubbing in the presidential race — losing previously Republican states of Virginia, Florida, New Mexico, Colorado, Iowa, and Nevada. They were summarily rejected by the industrial states of America — Michigan, Pennsylvania, Ohio and Wisconsin. New York City, home to an increasingly whiny class of rich elites, was the epicenter for a massive loss for Republicans in New York. Overall, it appears Obama also won the popular vote by a comfortable margin, beating out Mitt Romney by more than 2.3 percent.

The loss was magnified by the fact that secret money super-pacs heavily favored the Romney campaign. When you add in the fact that oil, gas, and coal companies spent nearly half a billion dollars to support Romney and other GOP candidates, it clearly shows the strength and marvel of Obama’s win.

The rejection of the rich, establishment, fossil fuel and extremist agendas was also apparent in the Senate. So far, democrats have extended their majority by two seats and have added an independent ally. In total, those who caucus with democrats on most issues include a much more solid majority of 55 seats. In the House, Republicans appear likely to lose 5 seats. Though Republican losses in the House are not enough to re-establish Democratic control, they do erode overall Republican Congressional influence.

The US electorate’s action against Republican extremism and obstructionism becomes even more clear when you dig down to look at who actually lost. The most extreme anti-abortion Republicans — Aikin and Mourdock — were both summarily defeated. Scott Brown, a tea partier, fell to the ardent progressive Elizabeth Warren. Sherrod Brown, both a climate and working class champion, handily defeated a tea party challenge from the anti-women’s rights Josh Mandel. The progressive Tim Kaine defeated ‘tax cuts for the rich’ George Allen. Patrick Murphy appears to have narrowly edged out tea party extremist Allen West. Stalwart progressive Alan Greyson has returned to the House and will likely prove a thorn in Republicans sides.

Among the more extreme Republicans (a relative term in a rather extreme party), only Michelle Bachman appears to have scraped by, barely eeking out a victory by a mere 4,000 votes.

Mitch McConnell, who lead the Republican hostage taking of the US economy in order to extort more tax cuts for the rich and to sabotage Obama’s re-election, has summarily failed. The Republican Party, who pushed ever more extreme conservative policies and who attempted to employ voter suppression over a swath of swing states, has summarily failed. This loss is nothing short of a new rejection of failed Republican policies and of denying Republicans the opportunity to re-assert their trickle-down economics, their anti-woman agenda, their anti-immigrant agenda, and an oil, gas, and coal backed set of policies that will result in a hellish heartland and flooded coastlines.

Republicans, who continue to rationalize ways to keep living in their bubble reality, will now attempt to claim that the American people have mandated that Obama and Democrats acquiesce to Republican demands. But this is nothing more than a false assertion. What the American people have mandated is that Republicans be less extreme. That they do not only represent the wealthy. That they do not continue to deny climate change. That they do not continue to endlessly seek to extort tax cuts for the rich. That they do not endlessly seek to de-regulate Wall Street. That they do not continue to push policies that encourage companies to ship US jobs overseas. That they do not continue to attack, demonize, and victimize immigrants. And that they do not continue their endless assault on women’s rights.

In order for Republicans, and America for that matter, to survive and thrive, they must begin to moderate their positions on all these issues. To fail to do so would be to consign them, and possibly the rest of us too, to the dust bin of history. And that is the lesson people should learn from this election. Democrats have already moderated their position on many, many issues. It is now the Republicans turn to cast away their extremist roots and meet us where we already stand — in the middle.

“Let Detroit Go Bankrupt” Romney Attacks GM in Final Days of Election; GM Defends Record From Romney Lies, Calls Them ‘Fantasy’

Before we get into the new morass of mud and muck dredged up by the Romney campaign and slung at the US auto industry, it’s important to establish a few facts. This effort is useful as the Romney campaign, with its almost daily distortions and flip-flops, has been the most fact-free bid for the Presidency of any election cycle in modern memory. Romney’s most recent smear campaign, waged against the US auto industry and, by extension, American workers, is just the newest in a daily stream of distortions, gimmicks, smears, and attempts to terrorize the US electorate.

First, in an op-ed to the New York Times entitled “Let Detroit Go Bankrupt,” Mitt Romney, in his opening sentence, stated:

IF General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye.

Coming into office and facing the worst economic decline since the Great Depression left behind by the Bush Administration, President Obama decided to act to save over 2 million American jobs by directly supporting the auto industry bailout. Though far less expensive than the TARP program to bail out the US financial sector, the auto bailout provided much more direct support to the US middle class by ensuring that auto industry and supply chain jobs were not lost and that key US industries did not collapse. Conservatives of every stripe immediately howled that such government intervention would result in an US auto industry ‘doomsday.’ And Mitt Romney added his voice to those claiming US automakers would fail if they accepted government assistance during the worst of times.

As the years passed, Mitt Romney and conservatives have been proven drastically wrong. The US auto industry has recovered. GM is again the number 1 seller of automobiles in the world. And the industry is in the process of adding US jobs and repatriating jobs from overseas. This dramatic success belies republican and Romney drama to the contrary. It shows that the leadership role Obama took to save the US auto industry is now beginning to pay off. And, most glaringly, it shows the deep, systemic, failure of the current, rigid republican economic ideology.

Meanwhile, the corporation Romney built — Bain Capital — is now preparing to dismantle a factory that manufactures sensors for the auto industry in Freeport Illinois and ship their jobs overseas. Nearly 200 workers at the Sensata factory which Bain bought-out will find their jobs outsourced to China before the end of this year. This is a result of the outsourcing and off-shoring legacy that Romney pioneered while head of Bain Capital. (See more about Sensata here.)

This dual narrative of Obama’s leadership and success combined with Romney still profiting from liquidating US factories and sending the jobs overseas has had devastating effect for Romney in states like Ohio, Pennsylvania, Wisconsin and Michigan who know all too well how damaging outsourcing and off-shoring have been to their economies. Loss of critical factories like the one at Sensata has resulted in the gutting of entire communities. Whole neighborhoods in Detroit are now ghost towns as a result of the kind of outsourcing Mitt Romney pioneered at Bain Capital. Some of these lost jobs may never come back, captured by 99 cent an hour Chinese workers and a country that is unwilling to establish laws to protect its own people from the abuses of vulture capitalists like Romney. China may as well have foisted a sign emblazoned ‘Robber Barons R’ Us.’ And, Romney, among many others, came flocking to exploit the slave wage labor there by dismantling US factories and sending them overseas.

Perhaps too late, Romney has realized how damaging these methods of employing equities firms and off-shoring practices to accumulate personal profit have become. But the realization appears to have now stuck with a vengeance. And, in typical Romney fashion, Romney is now waging a media campaign against the very business Obama was so successful in saving and that, since late 2009, has directly added thousands of US jobs.

The Romney campaign is now running a malicious and false advertisement claiming that Jeep plans to ship US jobs overseas to China. The ad comes as Jeep revealed plans to build two manufacturing plants in China over the coming years. But, contrary to Romney’s false assertion, Jeep’s China expansion is not coming at the cost of any US manufacturing. Unlike Romney’s Sensata, no Jeep facilities are being shut down. No workers are being forced to train their Chinese replacements, as Romney’s Bain is forcing Sensata workers to do so. In fact, Jeep and GM have pledged to take profits from the Chinese operation and use it to create more jobs in the US. It’s almost the exact reverse of the Romney model. Call it in-sourcing, or re-sourcing, or repatriating, or even re-shoring. But it’s definitely not the Romney/Bain model for outsourcing and off-shoring.

Since late 2009, Jeep alone has added over 4600 US jobs, showing, in fact, that Romney’s claims are patently false.

GM was quick to defend its record from Romney’s false attacks:

“We’ve clearly entered some parallel universe during these last few days,” GM spokesman Greg Martin said. “No amount of campaign politics at its cynical worst will diminish our record of creating jobs in the U.S. and repatriating profits back to this country.”

Crysler CEO Sergio Marchionne in an email to employees refuted Romney’s claims by simply laying out the facts:

“Jeep production will not be moved from the United States to China,” Marchionne stated in the e-mail. “The numbers tell the story,” followed by specific investments Chrysler has made in Detroit, Toledo and Belvidere, Ill. “Those include more than $1.7 billion to produce the successor of the Jeep Liberty and hire about 1,100 workers on a second shift by 2013.”

The additional 1100 jobs are on top of the 4600 jobs Jeep has already added. In contrast, Romney’s Bain will, in the next couple months, send another 200 jobs to China. So the contrast couldn’t be more stark.

And the media is starting to pick up on Romney’s egregious assault of lies against the US auto industry and US workers. The Atlanta Journal Constitution recently called the Romney advertisements attacking the auto industry ‘economic terrorism.’ The Detroit Free Press has published this in-depth piece exposing Romney’s false claims. The conservative-leaning US News and World Report posted an analysis showing how the US auto expansion in China was helping to support jobs expansion at home. And FactCheck.org labeled Romney’s recent advertising blitz “flat wrong” stating:

“It’s misleading to suggest that Chrysler’s decision to expand into China will cost U.S. jobs — especially after the company has said it would have no impact on its U.S. operations.”

The fact-checking website noted a report from Bloomberg that Chrysler was considering “adding Jeep production sites rather than shifting output from North America to China.” Meanwhile Chrysler, in a dramatic refutation of Romney’s doomsday prediction for the US auto industry, just reported a third quarter profit of $381 million, up 80 percent from a year ago.

It seems likely that the Romney misinformation machine may have just bitten off more than it can chew. Considering the wide-ranging backlash taking shape from both the US auto industry and the broader media, it appears that Romney’s false attacks against GM and Jeep are about to erupt in his face. The US auto industry is firmly on its path to recovery, with each new report showing positive results. Further, the US auto industry is in the process of adding thousands of jobs here in America. Both of these points prove Romney dramatically wrong. Wrong in his ‘Let Detroit go Bankrupt’ op-ed and wrong now. Finally, these attacks only serve to call attention to Romney’s own record of sending US jobs overseas, the most recent example of which is Sensata.

Links:

http://www.freep.com/article/20121031/NEWS15/310310091/GM-and-Chrysler-Romney-is-wrong

http://www.nytimes.com/2008/11/19/opinion/19romney.html?_r=0

http://blogs.ajc.com/jay-bookman-blog/2012/10/31/gm-on-romney-campaign-politics-at-its-cynical-worst/

http://www.usnews.com/news/blogs/rick-newman/2012/10/31/memo-to-mitt-romney-gms-success-in-china-is-good-for-america

http://www.cbsnews.com/8301-34222_162-57542993/gm-like-chrysler-refutes-romneys-auto-industry-ad/

http://www.politico.com/blogs/burns-haberman/2012/10/gm-aide-romney-ads-part-of-parallel-universe-147753.html

http://www.upi.com/Top_News/US/2012/10/30/GM-Gap-between-Romney-ad-and-reality/UPI-56761351637557/

Are Renewable Energy Sources Set to Outcompete Fossil Fuels?

A flurry of news reports heralding a new oil and gas age for the US glosses over a dark and difficult to deal with fact. The cost to extract both of these non-renewable resources is increasing. Tight oil and gas fracturing, claimed to be an energy savior for the US despite a plethora of problems including well casing leaks, contaminated water supplies, methane leaks, surging investment costs, and high costs to bring the fuels to market, are expected, by many sources, to be the ‘new future.’

In short, the ‘new future’ looks a lot like the old past, but much more expensive and coming on the heels of a long string of global warming impacts. For gas, the cost of the tight sources is over twice that of traditional wells, costing around $5 to extract a unit of tight shale gas. For oil, tight shale supplies require as much as $90 dollars per barrel to produce. These high costs are nearly twice as much as the often derided and vilified ethanol, which requires $50 dollars per barrel to produce without subsidy.

But the massive oil and gas marketing campaign to put out renewable energy’s electric fire continues apace. This week showed a flurry of glittery and optimistic oil and gas reports coupled with the typical volley of hit pieces aimed at everything that replaces oil from the Chevy Volt to your friendly neighborhood wind farm. The usual suspects all repeated their shrill and desperate chant of ‘the Volt is dead’ a month after Volt sales reached new records and costs to produce each vehicle were dropping fast as sales numbers increased.

Misinformation painting the Volt as uneconomic was belied by these numbers and a recent report showing that the Volt only costs consumers 3 cents per mile to drive. A regular ICE vehicle at $4 per gallon gasoline and 30 miles per gallon fuel efficiency costs 13 cents a mile to drive, more than four times as much. How does the Volt achieve such a feat? Get rid of as much oil input as possible and move to a, far more efficient, battery and electric motor configuration.

Perhaps these lower costs are the reason owners rank the Volt highest in customer satisfaction.

The Volt is dead! Long live the Volt!

But despite all the positive attributes of this powerful, new American technology, a large section of the media is now bent on killing the vehicle. At every success a new negative spin is generated. For example, as the Volt broke sales records last month, hundreds of blogs and articles parroted the fact that GM was offering discounts on the car as a sign of weakness. The same papers and blogs, many months before, criticized the Volt for being too expensive. So which is it? Similar negative information has been spewed about wind, solar, and biofuels. The only solution heralded by these ‘news’ sources appears to be fossil fuels, whose rather large and long string of negatives these news sources wholly ignore. Which ultimately begs the question, who pays the check?

Attempts at fossil fuel dominance and public opinion shaping ranged long and far throughout traditional media and in politics. Overall, it was a typical, banner week for the increasingly rickety fossil fuel based economy. But despite all this misinformation which one blogger recently to compared to the reign of ‘the Dark Lord,’ there were a number of glimmers of hope peaking out through all this misinformation.

As mentioned above, Chevy recently discounted its revolutionary Volt by as much as 10,000 dollars or offered leases for $299 (not $159 as claimed in the misinformation media), spurring new sales and raising the possibility that total Volt sales would reach 30,000 by end of September. Overall, this is far better than the earlier launch of the, equally derided and vilified at the time, Toyota Prius during its first two years. In addition, even as prices for the Volt are going down, quality is going up. The EPA estimated battery range for the vehicle has climbed from 35 miles to 38 miles resulting in a combined average mileage of 98 mpg. This gives most Volt users about 1000 miles of travel between fill-ups which means savings on top of savings for owners.

In addition, US alternative energy coming from solar, wind, and geothermal, as a percentage of electric power, has grown from 3% to 6% within the last four years. Total alternative energy from electric power adding in hydro-electric and geothermal is now over 15%, more than nuclear energy as a proportion of electricity generation. And since the primary contributor to greenhouse gas emissions is electricity generation (coming from coal and natural gas generation and extraction), this leap in alternative energy capacity is a help in dealing with the problem of climate change.

Perhaps most important is level costs and falling prices. Wind and solar energy are very stable energy sources, making it easy for investors to predict outcomes. Not so with natural gas, which is one of the most volatile energy sources available, making it a baby for those who love to game the market. And as time has gone forward, costs for wind and solar continue to drop. Wind is now less expensive than everything but the least expensive natural gas plants. And solar is now less expensive than new nuclear energy and combined cycle gas and coal plants that could be retrofitted for carbon capture at even greater prices. In fact, over the past 18 months, the cost of solar panels has dropped by 65%, leading to a boom in panel sales around the world and in the US even as modest subsidy support for the new energy sources may be withdrawn.

The same can certainly not be said for fossil fuels. Natural gas is driving some companies to the edge of bankruptcy due to the rising cost of extraction and a glut on the market, caused, in part, by rising alternative energy usage. In addition, oil just saw its most expensive year on record. And people are beginning to awaken to the vast external costs and harm of coal use, with opposition to new plants rising in the US and around the world.

Across the globe, countries are taking notice of the alternative energy sea change. During a period this spring, Germany produced 50% of its energy from solar panels. That number is expected to rise to as high as 70% by next year. And as one of the only bright lights in Portugal’s ailing economy, it has managed to install enough renewable energy to make up 45% of its entire electricity grid. Going forward, this energy capital will help to stabilize and improve an otherwise troubled economy by reducing its dependence on imported fuels. Similar stories are being told across Europe and in places in the US. North Dakota produces 20% of its electricity through wind. California and Texas are following suit.

A view of the total installed capacity for US wind energy can be seen below (As of August 2012, the number broke 50 gigawatts installed, a 3.1 GW addition in just 8 months!).

The EU has installed 100 gigawatts of wind capacity and China boasts over 60 gigawatts of installed wind energy capacity. In total, nearly 50 gigawatts of new wind energy capacity will be installed during 2012. Solar energy is now surging to catch up, with total solar energy installations to reach 30 gigawatts in Germany alone this year. The US now boasts 6 gigawatts of solar energy and growing and the world is now adding nearly 30 gigawatts of solar energy capacity each year. This combined installation of 80 gigawatts wind and solar each year is a significant leap forward for alternative energy and is starting to prove its ability to outpace fossil fuels as a primary energy provider.

A sad fact is that, without the harmful media and political campaign being waged by US oil, gas, and coal special interests, the US could be even further along in developing domestic energy sources independent of foreign influence or climate damaging pollutants. Recent opposition to the production tax credit by oil money soaked republicans in Congress now threatens thousands of US alternative energy jobs and will likely further slow development of wind and solar energy production capacity within the US. This removes a key feed-in to US manufacturing and cedes more leadership to competitors overseas — primarily Europe and China. But the republicans, who run on the false mantra that they believe all ‘government subsidies are bad,’ never saw a fossil fuel subsidy they didn’t like and are fighting tooth and nail to keep the oil and gas industry’s incentives of 40 billion dollars intact even as they campaign on expanding subsidy support to this already subsidy bloated industry. But the republicans have been unable to stop what is a growing US and world-wide trend, only delay it, much to the harm of their native country.

(Romney and the republican strawman, Solyndra, on campaign trail together)

The renewable energy boom in the US has also led to a benevolent side effect — an increase in US manufacturing, installation, and alternative energy service jobs. Overall, green energy supports three times the number of jobs when compared to fossil fuels. As a result, more than 8.5 million people work in an alternative energy or energy efficiency related profession, according to Business Week. Look at the map below to find the nearest wind energy component manufacturing facility. Most likely, it is in a city or state near you:

All these facts combine to make the alternative energy sector a growing challenge to the established fossil fuel special interests. And, for this reason alone, we are likely to continue to see a stream of misinformation and demonization of the alternatives coming from fossil-fuel associated sources. But the next time you hear someone say the words Solyndra in a political context, bash wind or solar, or demonize the Volt, it’s important to know where that message originated — those casting their lot with the dirty, dangerous, and depleting fossil fuels.

Links:

Climate Change, Resource Depletion Making Oil Dependence Economically Unsustainable

Over the past few months, we’ve been focusing primarily on climate change’s amplifying impacts and increasing damage to human societies. But with this month’s Department of Energy Short Term Energy Outlook (STEO) report, it is important to take a step back and examine again the powerful economic headwind that is resource depletion.

In context, oil, gas, and coal companies have, over the past few years, been fighting an epic political and public relations battle for the hearts and minds of the American people. We can hardly avoid the commercials. The endless repetitions of ‘we agree’ glossing over oil companies agendas on television again, and again, and again. We can hardly avoid the slanted news reports. The hit pieces that are put out on the Chevy Volt with almost weekly recurrence, the most recent one coming from Reuters. And we can certainly not avoid the massive political influence the fossil fuel companies have exerted on the political process this year in the Presidential, National, and State elections.

The energy future of the United States and our climate and economic health will, in many ways, depend on whether or not the fossil fuel companies, led by the oil companies, again gain dominance over both our energy and our political systems. In short, oil, gas, and coal have no future. And tieing our futures to those dirty, dangerous and depleting fuels is like grabbing hold of a 200 lb iron weight while struggling to tread water in a stormy ocean.

Why? Well, for starters, the oil companies aren’t any where near close to telling us the truth about the economic viability of their fuels.

The first set of misinformation is well established. The fossil fuel companies, much like the tobacco companies of a by-gone day, much like the south which depended on slave labor for their economic prosperity, aren’t telling us the whole story. In the case of climate change, they’ve actively waged numerous vicious public relations campaigns not only aimed at misinforming the public on the urgency of the climate crisis. They’ve also funded numerous attack campaigns leveled directly against the climate scientists themselves. Such a wide-spread war on science hasn’t been seen since the Renaissance. It has resulted in many scientists receiving death threats. But the broader damage is to society which is now facing the worst climate crisis ever in human history. The trouble fossil fuel emissions have brewed up in our atmosphere could easily be called Biblical. And whether or not we respond to this threat in a timely fashion is a matter of life and death for human civilization and for the human beings who depend upon it for survival.

Though the issue of climate change is pretty broadly understood, the second issue making oil non-viable as an economic resource is less well understood. And, though probably less harmful overall than climate change, its revelation gives lie to the assertion by oil companies that its fuels are a resource necessary for economic growth. To the contrary, the fuel is economically destructive. Why? Because it has depleted to the point that it is no longer economically viable to remove an increasing portion from the ground.

Just last week, reports from fracturing companies found that as oil prices dropped in June, July and early August a number of wells in the tight oil fields of North Dakota and Texas were idled. Why? Simply because these companies could not make a profit on oil costing less than $90 per barrel. This very high marginal cost of oil is bumping up against the level at which world economies suffer from recession. A range that the current economic malaise is proving is between $100-$150 dollars per barrel. The oil is just getting too darn expensive for a world economy to run on.

Then this month’s STEO report rolled in showing preliminary data that doesn’t bode well for the future of world oil production.

But before we go into this month’s STEO report, we should talk for a moment about the ridiculous papers being put out by the world’s oil establishment. Just last month, a former oil executive published a paper entitled “Oil the Next Revolution.” Just looking at the title brings up a little of a chuckle. Wasn’t oil last century’s revolution? Making such an extraordinary claim would require extraordinary evidence. But Leonardo Maugeri completely fails to deliver. First, he makes a highly spurious claim that world oil production will reach 110 million barrels per day by 2020. He does this by tinkering with the decline rates — he assumes a less than 2% decline rate for the world’s existing and future oil fields, the real rate is somewhere between 4 and 7 percent. Next, he makes extremely optimistic predictions about the world’s ability to economically produce tight oil like that in the Bakken. Finally, he conflates natural gas liquids with oil production. Unfortunately, natural gas liquids aren’t so easily fungible with oil, requiring highly specialized refineries to turn into diesel fuel. Maugeri claims a total of 49 million barrels per day of new oil conflated with natural gas liquids gets us to this 110 million barrels per day by 2020 in an environment of very low decline rates and very fungible natural gas liquids.

Maugeri is vastly wrong. He is wrong when it comes to the decline rate. He is wrong when it comes to the fungibility of natural gas liquids. And he is wrong on the ability of the world to economically add 49 million barrels per day of new supply. And this is where I return to the marginal price of fractured oil. $90 today. That’s what’s required to lift the new oil up out of the ground. What does Maugeri assume for his price of oil in 2020? Maugeri assumes oil will remain above $70 per barrel.

Maugeri already got the price wrong. We can’t maintain 89 million barrels per day at less than $90 per barrel.

Enter this month’s most recent STEO report. Now the first number we want to look at is consumption. Consumption is the best measure for world demand. Despite misinformation to the contrary, world demand has been very high since 2004. The only time in which the world experienced a reduction in demand was during the Great Recession in 2008 and the downturn that followed in 2009. At all other times during this period, demand was going up. Today, according to the STEO report, world oil consumption/demand is sitting at around 90.17 million barrels per day. Now just keep that number in your mind.

Now let’s look at the next number. World supply. That number is 88.41 million barrels per day. Immediately, we can do a little math and figure out that supply is less than demand by about 1.76 million barrels per day. This situation would tend to support a high price of oil. Well higher, in fact, than the marginal cost of producing a barrel of oil. And what was the average price? About $94 per barrel over the month of August just $4 per barrel above the supposed marginal cost of production. But let’s hold here on prices and talk a little bit more about supply.

In August, total world oil supply fell by 160,000 barrels per day from July. This isn’t too big of a deal at first blush. But it does follow a fall in oil supply of about 140,000 barrels per day from June, another fall of 130,000 barrels per day from May, and another fall of 120,000 barrels per day from April. This total of 550,000 barrels per day loss in production over the course of four months is not what one would expect to see if the world were on the verge of roaring to 110 million barrels per day within 8 years. In fact, we should see, on average, an 800,000 barrel per day increase over the same time period if that were the case.

But the overlying data isn’t what’s most disturbing. It’s where the losses come from. From July to August of 2012, US oil production fell by 300,000 barrels per day. Part of this loss is due to the fact that marginal, high cost, fields were idled due to the falling price of oil. In other words, these fields could not produce oil economically and were temporarily shut during a period when oil prices averaged at about $94 per barrel! Other losses likely came from ethanol production due to the fact that corn took a huge hit in this year’s climate-change induced drought (it is worth noting that, these days, ethanol counts as oil).

What brought down US oil production in the month of August can best be described as a combination of oil depletion and climate change.

But before we depart from the oil supply picture, let’s take a look at one other country — Russia. In the STEO report, Russia is listed as the Former Soviet Union. It includes all the oil producing states formerly part of the Soviet Union (FSU). Notably, August saw FSU production fall by 261,000 barrels per day to its lowest levels since August of 2009. This drop is an ominous sign for the prospects of world oil production. Russia relies on a number of very large depleting oil fields for the bulk of its production. Major efforts have been made to enhance production. But, according to the most recent reports, these efforts appear to be falling short.

Back to the larger picture, it appears that world oil production has stalled and fallen back into a slow decline. And there are troubling signs coming from both Russia and the United States.

Now, with these less than happy thoughts in mind, let’s go back to demand, supply, and price. Normally, in a natural environment, the price of oil would be allowed to rise so that new supply could come to market to meet demand. We have supply shortfall. We have marginal production waiting on the sidelines. So why isn’t price rising? What’s holding back price?

One need only look at the current world economic situation to see what’s keeping price in its gate. The world is, essentially, lurching about at the brink of another recession. Any bump in oil prices may kick the world back over the edge. So, in this event, high marginal prices of oil are bumping directly up against the world’s economic ability to sustain demand. And given the current leeching away of world oil supply, that ability is again placed in serious doubt.

Given these factors, it is increasingly clear that the world’s oil companies aren’t telling us the truth. Despite every economic contortion possible, oil is simply no longer a viable means to sustain and grow the world’s economies long-term. It is too expensive to extract. Its marginal prices are too high to bear. And the damage it inflicts on world economies through the ongoing and amplifying force of climate change creates an external insult that further reduces the abilities of economies to rationally function. Simply put, the oil is unsustainable and the faster we are able to both increase efficiencies, alternatives like the Volt, and the proportion of our renewable energy allotment, the better off we will be.

As for the oil companies endless re-assertions. We decidedly do not agree.

Links:

http://www.eia.gov/forecasts/steo/tables/?tableNumber=6#endcode=201312&periodtype=m&startcode=200901

http://belfercenter.ksg.harvard.edu/files/Oil-%20The%20Next%20Revolution.pdf

Are We Better Off Today? 2008 vs 2012

The best customer for American industry is the well-paid worker. — FDR

Some of the choices that we make are going to be difficult, and I have said it before and I’ll say it again: it’s not going to be quick and it’s not going to be easy… — Barack Obama, First Press Conference, 2009

At the end of 2008, after years of failed policies, after two unpaid for wars, after deregulation left the financial markets to their own irresponsible devices, America was suffering from the worst economic collapse since the Great Depression.

Today, after 29 consecutive months of jobs growth, after a restoration of the credit markets, after an American automobile industry that has not only been revived, but experienced a renaissance, an America enjoying a revitalized stock market restrained from the worst excesses of greed is now on its feet and in fighting form.

The difference between 2008 and 2012 is the difference between economic devastation and a reason for economic hope.

These disparate situations did not evolve from one to the other in a vacuum. The failed policies that led to the Great Recession were replaced by the successful policies that resulted in an America back on her feet. Dodd Frank reigned in the worst Wall Street excesses. Sound banking policy reinvigorated the credit markets. The Stimulus provided states and communities with much-needed funds during the recession’s darkest days. The first unpaid for war was ended and the second is drawing to a close. GM, which Romney had said should be allowed to go bankrupt, is now the most successful automaker in the world. A vast raft of energy polices pushed by Obama resulted in plummeting US oil imports, increased efficiency, and increased domestic energy production. The alternative energy sources of the future have doubled their production. And the US is producing automobiles like the Chevy Volt which, combined with the renaissance in alternative energy technologies,  give reason to hope for achieving both energy independence and climate security.

In short, Barack Obama gave America back her shot at a good future. Her potential. Her ability to face adversity and overcome it. For a certainty, he did not satisfy everyone’s greatest hopes and expectations. But what he delivered was a stunning and marked improvement over the terrible harm that came to us during the Bush Administration. And this transformation was achieved in a short time. Only four years were needed. It could well be argued that Obama has done the impossible.

Looking around the world, it becomes even more clear that America’s position is vastly improved. Europe is teetering at the edge of recession, China is losing its grip on manufacturing supremacy, and the world is suffering under a brutal regime of increasing food and fuel prices. To achieve any economic growth in such an environment, in the face of such stiff competition, would be a sign of virtuoso, of expertise, of strong leadership. And Barack Obama has certainly delivered.

Even our standing in the world, which was wretched under Bush, has improved. Many nations trust us again, believe that America is again a positive force in the world. Our trade situation, though still difficult, has continued to improve. On the national security front, we have gracefully disengaged from Iraq and have reasonable hope to do the same in Afghanistan. Osama Bin Laden is no longer a threat and Al Qaeda is disorganized, dispersed, and demoralized. The Libyan conflict was handled in a manner that preserved both national treasure and resulted in a positive outcome.

Obama has earned success after success and at every turn, he has been forced to fight against Americans who should have aided him. The Republican Congress, whose policies Obama often adopted, had moved to obstruct Obama at every opportunity. ‘No compromise’ is an understatement to describe the situation Obama was forced to deal with. Never in America has such a level of obstructionism been faced by a standing President. Every single policy measure Obama put forward was demonized even as he was attacked for the responsible act of working for solutions. It would seem that republicans would rather Obama have done nothing. Or had simply re-applied the failed policies that Bush used. The same policies that wrecked the economy in the first place.

The Republican leader of the Senate claimed his number one priority was to make certain Obama didn’t get re-elected. And what proceeded from the Republican sectors of Congress could best be described as willful sabotage. It wouldn’t be so bad if the Republican vendetta against Obama had only been personal. But what started as personal attacks quickly evolved into an assault on America’s prosperity.

The current vice presidential candidate, Paul Ryan, who sat on the critical Simpson Bowles deficit reduction committee, turned his back on Republican deficit reduction policy in order to fight all efforts offered by the President for long-term deficit reduction, no matter how many concessions to Republicans those proposals contained. And, at the height of hypocrisy, Ryan blamed Obama for the failure of Simpson Bowles when Ryan, himself, lobbied Republicans in Congress to vote against the deficit reduction plan. In short, Ryan killed American deficit reduction policy and then attempted to blame Obama. As such, Ryan is the very face of Republican sabotage and obstructionism.

What makes Ryan’s and Republican efforts to sabotage Simpson Bowles so bad isn’t that it hurt Obama. It hurt the American people. It put off the hard work of dealing with the national debt and forced a historic down-grade in the United States credit rating. The result is that the cost of debt increases and this is a devastating long-term harm to taxpayers and to effective government. It results in more wealth being sucked out of the United States and going to creditors both private and foreign.

Republicans seem to love to talk about the need for deficit reduction. But, in practice, both as Presidents and as legislators, they have been terrible at enacting effective deficit reduction policy. Instead, they hand tax cuts to the wealthy, pick more wars than they can afford, and spend like drunken sailors. When money is tight, Republicans, instead of asking for more from the most powerful and privileged members of society, instead turn to prey on the weak, destitute, and voiceless. Medicare and Social Security will be the next programs to be gutted by the Republican’s irresponsible taxation, spending, and war-fighting policies — should they again see power.

Ryan’s own attempt to worsen the deficit crisis in order to harm a sitting President, however, is a vast, destructive, irresponsible and narcissistic misuse of power. It is another departure from effective leadership. A departure that is just one more phase in a long and devastating trend among Republicans in government.

But despite having to fight against an entire wing of US government willing to sabotage US economic security in order to pander to wealthy backers, for the soul cause of gaining power, of winning elections, Obama has still managed to achieve amazing success. He has been able to transcend partisan bickering and reach beyond a barricade of petty personal attacks to lend a helping hand to broad sections of America. The fact that America is now standing, not bleeding on the floor as she was in 2008, is proof enough of that.

America is certainly far better off. But, sadly, she is still afflicted by an ancient brand of greed and short-sightedness that appears to have entirely devoured the Republican party. And so long as that harmful philosophy — not that of enterprise and innovation, not that of freedom, which should be a virtue enjoyed equally by all — but that of dominance, hoarding, and the endless gathering of wealth and power by fewer and fewer ‘privileged’ individuals. So long as that devastating philosophy afflicts us, we will continue to experience danger.

So we must stand up. So we must help the President who has done so much in his efforts to help us. So we must do our best to make certain that the failed policies and ways of thinking that wrecked America in the first place, that are inhibiting our progress even now, that are attempting to hold America’s very success as a hostage, do not regain hold of our great democracy.

We have seen that dark road. We have walked it long enough. We do not wish to return to the debacle that was 2008.

Romney’s Plan For 12 Million Jobs — Take Credit for the Work Done by Obama

During an arguably well-delivered speech at the Republican National Convention, Romney, unfortunately, served up a number of glaring whoppers. The first was his making light of an increasingly real, damaging, and dangerous climate crisis. This bald denial of an event affecting farmers all throughout the heartland was just the first of many statements that don’t quite jibe with facts, reality, or even decency.

Unfortunately for both Romney and the rest of us, Romney’s climate change denial was only his first fault. His second error had to deal with, not making light of a serious problem that needs addressing, but with attempting to do nothing and take credit for the hard work of others. In his speech, Romney claimed that his administration would create 12 million jobs. On its face, it sounds like an ambitious plan. But let’s take a little time to analyze this promise.

The sad, sorry, rough truth is that world economic conditions aren’t so hot when it comes to jobs. We have a number of powerful corporations ranging the globe searching for ever-more-productive workers for an ever-decreasing relative wage. The net effect of this endless flight to lower paying jobs is a world-wide pressure on all middle class and, for that matter, living wage jobs. Pervasive corporate worker exploitation on a global scale has made it increasingly difficult for people to find decent-paying jobs since the 1980s.

This growing jobs crisis reached a boiling point during the great recession when states began to adopt austerity programs. These programs drastically cut the number of decent-paying government jobs available. Now workers were faced with the tough reality that even governments weren’t likely to provide nearly as much in the way of worthwhile work. Austerity resulted in a geological shift in the employment market that drastically reduced the pool of living wage jobs. And it is, perhaps, ironic to note that the same corporations and political forces pushing lower wage market jobs were the same forces pushing for austerity in many countries, including the US.

The net result is that economic prospects, unless you’re the modern version of a robber-baron, aren’t so hot globally.

The US has been somewhat insulated to this hard reality through the efforts of President Obama. He pushed a stimulus program that was vital in reducing jobs losses and in restoring the opportunity for job creation. He has recoiled against republican efforts to force austerity on the United States. As such, he has preserved many well-paying jobs that would otherwise have been cut. However, since republicans dominate the House of Representatives and hold most US Governor’s seats, they have been successful in cutting public service rolls at the state and federal level. Less firefighters, teachers, researchers, police officers, and scientists means less decent-paying jobs available. A college graduate with a science degree might be forced, instead, to take a minimum wage, bad benefits job at Staples, for example.

But despite these political pressures and the predatory corporate practices resulting in an extremely adverse world jobs climate, Obama has managed to push through a number of policies that stabilized the US jobs situation. His first efforts stopped jobs losses at the rate of 750,000 per month during the last days of Bush. And his next efforts began the hard work of creating new jobs in an extremely adverse political and economic climate. These efforts resulted in a .84% increase in jobs so far throughout his administration. This increase, ironically, is equal to the percent of US jobs lost under Bush’s second term. It is more than the jobs created under Bush’s first term. It is also more than the number of jobs created under Bush senior or even the number of jobs created during the second term of Eisenhower.

After the worst economic crisis since the Great Depression and in the current terrible world jobs climate, this work amounts to serious heavy lifting. But looking forward, the real benefit of Obama’s jobs policies becomes even clearer. According to a recent report by Moody’s Analytics, over the next four years 12 million jobs will be created in the US. This is the more positive jobs climate Obama worked so hard to establish. And even if no further policy measures are implemented to create jobs, according to Moody’s, those 12 million jobs will be there.

And this, at last, brings us to Romney. It seems that climate change isn’t the only thing he and his fellow republicans are in denial of. It appears he’s in denial of the plain fact that Obama’s job creation policies actually worked. But his denial isn’t so deep as to disallow a cynical attempt to steal credit for the Obama Administration’s successes. This action is similar to that of a middle level corporate manager who waits for an enterprising employee to make a breakthrough and, essentially, steals his idea. So we can see where Romney’s corporate experience is starting to ‘shine through’ during this election process. But stealing an idea from a standing President isn’t so easy as from a victimized employee. The facts, as we have noted, are plainly visible for all should they care enough to look.

As for Romney’s so-called jobs ‘policy?’ According to fact checkers it is nothing short of a vague list of notions that don’t amount to any solid position at all. Nothing more than advertising and posturing mascaraing as serious political action. The Romney paper was so lacking in substance that analytic organizations had no means to score it for potential jobs created or lost. In short, it’s a puff paper.

So what, in the end, is Romney’s jobs policy?

Do nothing. Set America adrift. Take credit for other people’s work.

Worst Drought in 50 Years Risks Shutting Down Mississippi River

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(An aerial photograph of the Mississippi taken near Vicksburg, MISS, on August 2nd, photo credit: Shreveport Times)

According to news reports, the ongoing drought affecting much of the United States is now the worst drought in 50 years. Impacts are being felt all over the country where rivers and wells are drying up. Even the mighty Mississippi, one of America’s greatest superhighways for transport and trade, is feeling the effects.

Overall, the river is now 13 feet below average levels. But in some areas, the river is running up to 20 feet below average. In Vicksburg, Mississippi, the river gauge on August 2nd (photo above) measured the lowest daily river level ever recorded there. These record low river levels have had a serious impact on shipping and, in total, nine barges have run aground since mid July. Barges have been forced to lighten their loads in order to remain afloat — losing 17 tons for every inch of extra free-board.

In many places, river levels are below the record lows set during the 1988 drought, which temporarily shut down the Mississippi to river traffic. Shutting down the Mississippi would have a devastating impact on commerce. As much as $300 million dollars would be lost each day. And since 60 percent of US grain, 22 percent of our oil and gas, and 20 percent of our coal are transported by river, these commodities are likely to see increased prices, further harming already hard-hit consumers.

Already, river traffic has been hampered. In many places, traffic is now one-way. One cargo towing company that operates on the river has been losing $500,000 dollars per month since May.

In response to the drought and increasingly low river levels, the Army Corps of Engineers has been dredging non-stop. The corps now has five dredges operating around the clock on the upper Mississippi. Of the $21 million set aside for corps river operations, $17 million has been spent on dredging alone. In the south, the corps is installing a $5.3 million dollar salt barrier to keep salt from invading further inland and harming water supplies for communities up river.

Forecasters, unfortunately, expect drier than average weather to continue for the Plains and Midwest: http://www.cpc.ncep.noaa.gov/products/expert_assessment/DOD.html. These regions provide the primary water supply for the Mississippi and some forecasters are calling for river levels to fall further.

This drought is abnormal by any measure. But climate scientists such as James Hansen are stating that it is an extreme event resulting from human-caused climate change. In the past, scientists like Hansen had warned of increasingly extreme conditions due to climate change. And the past two years has been an excellent allegory for these predictions. Just last year the Mississippi experienced record flooding. Now, we are in a record drought that threatens to shut down commerce on the river.

Most climate models show that, as climate continues to warm, the United States continues to grow drier and drier. And though these impacts may already seem severe, they are mild compared to what lies ahead if carbon emissions aren’t drastically reduced by all countries around the world. This is the beginning of an ongoing crisis and the nations of the world will need major policy measures to responsibly deal with this crisis. To fail to act is not an option for a functioning civilization.

Please help support our continuing efforts.

Please help support our continuing efforts.

Links:

http://usnews.nbcnews.com/_news/2012/08/15/13295072-drought-sends-mississippi-into-uncharted-territory?threadId=3542091&commentId=68949959#c68949959

http://etfdailynews.com/2012/08/15/the-mississippi-river-is-drying-up-as-food-prices-continue-to-surge-moo-dba-ung-uso-jjg/

http://www.agprofessional.com/news/Barge-traffic-disrupted-on-Mississippi-River-166116476.html

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