Get Ready For Freak Weather  

While I generally like Michael Pascoe at Crikey, he seems to have been reading too much peak oil doomerism and has developed an allergic reaction to it in the form of a bout of free market mysticism, with the recent (possibly manipulated) pull back in the oil price causing him to exclaim "Cheaper oil and free gas – doomsday postponed again" (I'm not sure if today's bounce in prices immediately invalidates all his claims - trying to prove or disprove peak oil based on short term price movements is a fool's errand).

It’s getting harder for members of the peak oil doomsday cult to keep the faith – oil futures fell under US$59 a barrel overnight while natural gas prices in the UK turned negative, ie gas traders will pay you to take the stuff away.

Marketwatch.com summarises the oil price:

Crude-oil futures fell almost 4% (to close at $US58.68 a barrel), pulling the benchmark contract to its lowest level in more than a year, with pressure coming from swelling US inventories, a lack of risks to output and doubts that key oil producers will take formal action to reduce supplies and stem the drop in prices.

The market has "high inventories, high levels of exploration activity, no supply shortage, low consumption at this time of the year and no Gulf [of Mexico] hurricanes -- with lower chances of having one," said James Williams, an economist at WTRG Economics. "The combination of these factors is consistent with prices below $50 per barrel."

More shocking to the end-of-civilisation-as-we-know-it mob must be the glut of natural gas in the UK. A new pipeline from Norway is delivering into a market whose storage facilities are 96% full. Reports the BBC:

After trading at an average of 26p a therm through September, the spot price for gas delivered immediately fell to -5p during the course of the day, meaning traders are paying to get rid of it.

Major UK energy companies may be unable to take advantage of the free gas because of the lack of available storage and the fact that they have "hedged" supplies -- protecting themselves against the risk of high gas prices over the winter by buying it in advance at a lower price.

Prices will rise in the northern winter as the new pipeline won’t always be running at capacity and demand increases as the temperature falls. It nonetheless remains a reality check after the many scary headlines the world has been subjected to during the oil bubble.

A broader cheap oil perspective is on offer in Newsweek with a claim that Chinese demand has been overstated, but the peak oil cult members won’t be easily converted.

Oil prices will continue to bounce around with whatever supply shocks come along and petrol won’t be as cheap as we were used to, but the doomsday scenario has never made sense – the market mechanism and our incredible adaptive abilities are forever underestimated. Just watch us.

I mocked the Newsweek article earlier this week (Chinese imports are up 15% in the past 8 months) and both Roland Watson at New Era Investor and (glancingly) The Oil Drum (twice) have warned about the natural gas situation in the UK (and the oil situation throughout Europe) this week.

Markets will help us adapt our energy mix but they aren't some sort of magical fix-all - they don't handle issues like global warming (period) and they only handle peak oil (and gas) if people recognise what is happening in advance (or if the post peak production decline is slow and substitutes are developed in time). Given the poor quality information available about oil reserves, its entirely possible markets will fail to send the right price signals until its too late to adapt without much pain.

On the subject of markets, TOD also has a long post on the falling oil price being a harbinger of recession.

British energy customers must be wondering when the continued bad news of price increases will end. In a mini-version of "Peak Oil" in the UK, the sceptred isle will become and stay a net oil and gas importer next year. Retail suppliers of energy had been fearfully locking in prices for gas and electricity earlier this year but are now caught out by the drop in natural gas prices over the Summer. In fact, the new gas pipeline from Norway has been sending so much gas in their testing phase that the price dropped to -5p a therm as they gave the stuff away!

Here is the graph for wholesale gas below:

Customers want to know when they will benefit from these lower prices. The answer is most likely early next year as the higher priced hedges expire. Talk of price gouging once again pervades the media but the fact is that a combination of a rapid downside to UK Peak Gas and too much hedging by companies caused all of this.

Britain is a microcosm of Peak Oil in two senses. One is the fact that their reserves peaked in 1999. The second and more ominous is that few saw it coming. UK Peak Oil arrived silently and took the energy gurus by surprise. These so called experts also predicted Britain would be a net energy importer by 2010. The surprise decline in North Sea production has now brought that forward to 2007. So much for the experts and expect a repeat performance for worldwide Peak Oil.

Mobjectivist has another update on EEStor and their ultracapacitor technology. The post he links to makes the (fairly obvious I would hope) point that a smart grids and energy storage are but one piece of the puzzle - swapping out coal and oil power generation for renewables is the other.

But these are all forms of energy storage, not sources of energy on their own. The primary form of energy for the United States would still, even if every car had one of these EEStor capacitors in it, still be coal and oil. (We could use a lot less, but still.) The objective still has to be reducing the amount of oil we use to avoid Peak Oil (whenever it happens, better to prepare early.) Quite aside from Peak Oil, climate change requires that we stop using fossil carbon altogether. Storage technologies, exciting as they are, are not by themselves the answer.

While our media doesn't pay that much attention to the global warming issue (preferring to worry about the "terrorism" bogeyman instead), it seems global warming is right at the top of the list of national concerns for the voters.

THIS year's Lowy Institute poll reveals Australian concern over global warming to be the big "sleeper" issue of national affairs, a problem that worries Australians more than Islamic fundamentalism.

Australian public convictions on climate change have crept up on our political leaders and have now overtaken them. The political party that can best respond will harness a powerful force.

As the institute's executive director, Allan Gyngell, observes, "this has become mainstream; it's no longer just an issue for Greens and people dressed up in koala suits".

The annual Lowy Institute poll exposes three clear Australian conclusions about climate change. There is no ambiguity or hesitation on this issue any longer, with the "don't know" responses down to an unusually low 1 per cent.

First, this is a very big issue: 68 per cent of respondents rate it as a "critical threat" to Australia's vital interests over the next 10 years.

Just up the coast from me, desalination plants are becoming the focus for communities that are rapidly running out of water (I'm not sure what inland cities like Goulburn and Toowoomba who have already run their dams dry are doing, given their lack of an ocean to electrolyse). Sydney is cheating (for now) by siphoning water away from rivers further south into our main dam, which makes the dam volume figures rather rubbery). The Independent also has a good article on drought - worldwide.

GOSFORD and Wyong councils have begun a search for beach sites for a second lot of temporary desalination units that would produce enough water for 25,000 homes.

With dam levels down to 16 per cent and creeks running dry, the two councils, which share responsibility for water in the region, have already chosen sites for desalination units that will supply residents with an extra 8 million litres of water a day, or enough to supply about 20,000 homes.

The two councils on Sunday banned the use of all town water outside the home because of the dire state of their water supply. They are already tapping into bore water, taking water from the Hunter region and investigating major water-recycling schemes.

State Government and council support for desalination comes as Sydney transfers massive amounts of water from the Shoalhaven River to Warragamba Dam, while inland cities suffer from the drought.

The local press is still mildly excited about ethanol as a petrol substitute (baby steps) and Kim Beazley got a little press talking about hybrids and "flex fuel" ethanol capable vehicles. There is a long way to go to get this debate to where it needs to be...

A FEDERAL Labor government would abolish tariffs on imported hybrid and ethanol-compatible cars, reducing their price by up to $2000, the party says.

City drivers of these cars would receive traffic and parking advantages, the party leader, Kim Beazley, told a summit on alternative fuels hosted by the NRMA in Sydney yesterday.

He also promised to convert the Commonwealth's car fleet to green engines if the Australian car industry could develop the technology. "You build it, we'll drive it," Mr Beazley said.

But Australia's first 100 per cent ethanol-compatible car, which can also run on petrol, or some combination of both, will come from Europe.

Saab unveiled its "flex-fuel" engines at the conference. It will install the ethanol-compatible technology for an extra $1500. The technology, which is available in Sweden and Britain, has been used for decades in Brazil.

Professor Rubens Maciel Filho, of the State University of Campinas, Sao Paulo, told the summit it was hard for Brazilians to understand why Australians were not already using ethanol technologies.

Scientists at the environment and energy ministers meeting in Mexico are saying "Get ready for freak weather".

The world's top polluting nations were told on Wednesday to prepare for decades of weather turmoil, even if they act now to curb emissions and pursue green energy sources.

Environment and energy ministers meeting in the Mexican city of Monterrey vowed to work faster to control global warming as scientists told them each year wasted in curbing greenhouse gas emissions would cost them dearly.

Yet even if countries froze emission levels now, the world still faces 30 years of floods, heat waves, hurricanes and coastal erosion, the British government's chief scientific advisor David King, said.

King - who considers global warming a bigger threat than terrorism - said rich nations must help the developing world prepare for a weather shift that could put millions of lives at risk.

"We've got 30 years of climate change ahead of us even if we stop right now. We're persuading countries they have to adapt to the changes that are ahead of them," King told Reuters at the meeting of top greenhouse gas emitting countries.

"Because we've raised the carbon dioxide level in the atmosphere so quickly, the earth's climate system is falling behind. This is way in excess of anything the planet has known, probably for 45 million years," he said.

Among countries who sent ministers to Monterrey were China and India, whose ballooning demand for energy has made them some of the worst polluters after the United States, which pumps out a quarter of the world's greenhouse gases.

The United States, which could face fiercer hurricanes as sea temperatures rise, sent a senior official, but US officials did not brief the press.

Already, a roughly 1 degree Celsius temperature rise over the past century has allowed icy Greenland to start growing barley, and farmers in Spain are battling arid conditions.

"The people in denial now are the equivalent of the Flat Earth Society," British Energy Minister Malcolm Wicks told Reuters in an interview. "Humankind is in a race for life against global warming."

Crikey reports troglodyte Murdoch press columnist Andrew Bolt is still playing the global warming denial game - and being repudiated by the scientists whose research he has been misusing to perform his lobbying on behalf of the coal industry.

Anti-global warming columnist Andrew Bolt’s recent column "Bulled by a Gore" forensically picked apart Al Gore’s film An Inconvenient Truth by scattering a number of references to studies by eminent scientists through his argument. But one of those scientists is now accusing Bolt of citing his research in a “gross distortion of scientific findings”.

In his column (published in the Herald Sun and the Brisbane Sunday Mail in September), Bolt quoted the findings of Jeff Severinghaus, Professor of Geosciences at the University of California, San Diego:

Gore says ice cores from Antarctica, that go back 650,000 years, show the world got warmer each time there was more carbon dioxide in the air. In fact, as the University of California's Professor Jeff Severinghaus and others note, at least three studies of ice cores show the earth first warmed and only then came more carbon dioxide, many hundreds of years later. So does extra carbon dioxide cause a warming world, or vice versa?

Severinghaus told Crikey that he doesn’t make a habit of Googling his own research, but Bolt appeared on his radar when a librarian in Brisbane wrote to him asking if “I’d really meant what Bolt said I meant”.

He didn’t. “Many, many other studies have found that carbon dioxide causes the earth to warm. This is not controversial, and to continue to deny it is akin to denying that cigarette smoking causes cancer,” Severinghaus told Crikey. “The evidence for a human-caused warming of the globe is overwhelming. The scientific debate is over, and what we are seeing now is an attempt to mislead the public.”

Closing with Billmon on Iraq - apparently police brigades that act in concert with death squads get special remedial training when caught - I'm sure the citizens of Baghdad are glad to know that we're doing such a great job investing in their democratic institutions...