Printcrime - Capitalists Who Fear Change  

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The Daily Reckoning has an article on what Cory Doctorow presciently dubbed "Printcrime" a few years ago - Capitalists Who Fear Change.

Digital technology is reinventing our whole world, in service of you and me. It's free enterprise on steroids. It's bypassing the gatekeepers and empowering each of us to invent our own civilization for ourselves, according to our own specifications.

The promise of the future is nothing short of spectacular - provided that those who lack the imagination to see the potential here don't get their way. Sadly, but predictably, some of the biggest barriers to a bright future are capitalists themselves who fear the future.

A good example is the current hysteria over 3-D printing. This technology has moved with incredible speed from the realm of science fiction to the real world, seemingly in a matter of months. You can get such printers today for as low as $400. These printers allow objects to be transported digitally and literally printed into existence right before your very eyes.

It's like a miracle! It could change everything we think we know about the transport of physical objects. Rather than sending crates and boats around the world, in the future, we will send only lightweight digits. The potential for bypassing monopolies and entrenched interests is spectacular.

Here is what Andrew Myers reported in Wired magazine last week:

"Last winter, Thomas Valenty bought a MakerBot - an inexpensive 3-D printer that lets you quickly create plastic objects. His brother had some Imperial Guards from the tabletop game Warhammer, so Valenty decided to design a couple of his own Warhammer-style figurines: a two-legged war mecha and a tank. "He tweaked the designs for a week until he was happy. 'I put a lot of work into them,' he says. Then he posted the files for free downloading on Thingiverse, a site that lets you share instructions for printing 3-D objects. Soon other fans were outputting their own copies.

"Until the lawyers showed up.

"Games Workshop, the U.K.-based firm that makes Warhammer, noticed Valenty's work and sent Thingiverse a takedown notice, citing the Digital Millennium Copyright Act. Thingiverse removed the files, and Valenty suddenly became an unwilling combatant in the next digital war: the fight over copying physical objects."

There we have it. The American Chamber of Commerce - the supposed defender of free enterprise - is in a meltdown panic about new technology, determined to either crush 3-D printing in its crib or at least to make sure it doesn't grow past its toddler period.

In the 1940s, Joseph Schumpeter said that the capitalists would ultimately destroy capitalism by insisting that their existing profitability models perpetuate themselves in the face of change. He said that the capitalist class would eventually lose its taste for innovation and insist on government rules that brought it to an end, in the interest of protecting business elites.

The Great German Energy Experiment  

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Technology Review has a look at Germany's quest to move to 100% renewable energy - The Great German Energy Experiment.

Along a rural road in the western German state of North Rhine–Westphalia lives a farmer named Norbert Leurs. An affable 36-year-old with callused hands, he has two young children and until recently pursued an unremarkable line of work: raising potatoes and pigs. But his newest businesses point to an extraordinary shift in the energy policies of Europe's largest economy. In 2003, a small wind company erected a 70-meter turbine, one of some 22,000 in hundreds of wind farms dotting the German countryside, on a piece of Leurs's potato patch. Leurs gets a 6 percent cut of the electricity sales, which comes to about $9,500 a year. He's considering adding two or three more turbines, each twice as tall as the first.

The profits from those turbines are modest next to what he stands to make on solar panels. In 2005 Leurs learned that the government was requiring the local utility to pay high prices for rooftop solar power. He took out loans, and in stages over the next seven years, he covered his piggery, barn, and house with solar panels—never mind that the skies are often gray and his roofs aren't all optimally oriented. From the resulting 690-kilowatt installation he now collects $280,000 a year, and he expects over $2 million in profits after he pays off his loans.

Stories like Leurs's help explain how Germany was able to produce 20 percent of its electricity from renewable sources in 2011, up from 6 percent in 2000. Germany has guaranteed high prices for wind, solar, biomass, and hydroelectric power, tacking the costs onto electric bills. And players like Leurs and the small power company that built his turbine have installed off-the-shelf technology and locked in profits. For them, it has been remarkably easy being green.

What's coming next won't be so easy. In 2010, the German government declared that it would undertake what has popularly come to be called an Energiewende—an energy turn, or energy revolution. This switch from fossil fuels to renewable energy is the most ambitious ever attempted by a heavily industrialized country: it aims to cut greenhouse-gas emissions 40 percent from 1990 levels by 2020, and 80 percent by midcentury. The goal was challenging, but it was made somewhat easier by the fact that Germany already generated more than 20 percent of its electricity from nuclear power, which produces almost no greenhouse gases. Then last year, responding to public concern over the post-tsunami nuclear disaster in Fukushima, Japan, Chancellor Angela Merkel ordered the eight oldest German nuclear plants shut down right away. A few months later, the government finalized a plan to shut the remaining nine by 2022. Now the Energiewende includes a turn away from Germany's biggest source of low-­carbon electricity.

Germany has set itself up for a grand experiment that could have repercussions for all of Europe, which depends heavily on German economic strength. The country must build and use renewable energy technologies at unprecedented scales, at enormous but uncertain cost, while reducing energy use. ...

Despite the costs, Germany could greatly benefit from its grand experiment. In the past decade, the country has nurtured not only wind and solar power but less-­heralded energy technologies such as management software and efficient industrial processes. Taken together, these "green" technologies have created an export industry that's worth $12 billion—and is poised for still more growth, according to Miranda Schreurs, director of the Environmental Policy Research Center at the Berlin Free University. Government policies could provide further incentives to develop and deploy new technologies. "That is know-how that you can sell," Schreurs says. "The way for Germany to compete in the long run is to become the most energy-efficient and resource-efficient market, and to expand on an export market in the process."

If Germany succeeds in making the transition, it could provide a workable blueprint for other industrial nations, many of which are also likely to face pressures to transform their energy consumption. "This Energiewende is being watched very closely. If it works in Germany, it will be a template for other countries," says Graham Weale, chief economist at RWE, which is grappling with how to shut its nuclear power plants while keeping the lights on.

2012 Global Fuel Supply Still Flat  

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Stuart at Early Warning has a look at global oil production trends - 2012 Global Fuel Supply Still Flat.

I seem to be the only person paying much attention to this, but I still think it's significant. May figures for global liquid fuel supply are out from OPEC and the IEA and they continue to show that global supply has increased very little since January (in contrast to the very strong increases in the second half of 2011).

Other things being equal, we would expect this to lead to rising prices. Instead, prices have been weak/falling as a result of Eurozone fears. The fears about the eurozone are legitimate, but still, at present the global economy has got to be growing, if a little weaker than normal. Only Europe is actually contracting at present and that mildly. Thus, if the fears do not translate into much more pronounced global contraction in reality fairly soon, oil prices could jump up quite a bit. On the other hand, of course, if Europe does turn into a full-blown financial crisis then they could fall further.

There is a strong Schrodinger quality to the oil markets at present: prices are a superposition of the state in which Europe turns into a major global financial crisis, and the state in which it doesn't. I wonder how long before the measurement is made?

Stuart also has a look at oil production in Iraq and some of the dodgy reporting of production trends- Is "Soaring" the Right Word Here?.

Ten days or so ago, I posted the graph above under the headline "Sharp Uptick in Iraqi Production". I chose my words carefully - "uptick" to indicate that this was a movement upward of the same general order of magnitude as other recent movements in the time series, and "sharp" to emphasize that, as upticks in Iraqi production go, this was a somewhat larger and faster one than has been typical (but not, in my judgement, so great as to make the use of "uptick" misleading).

Yesterday, the New York Times decided to report on the same development under the headline "Oil Output Soars as Iraq Retools":

BAGHDAD — Despite sectarian bombings and political gridlock, Iraq’s crude oil production is soaring, providing a singular bright spot for the nation’s future and relief for global oil markets as the West tightens sanctions on Iranian exports. ...

I don't object to the graphic. Nor of course do I disagree that Iraq's production has increased and is likely to increase further (I've been covering this for a long time).

But I do really question whether the sober grey-lady paper-of-record should refer to an increase of about 300kbd above the level of last fall as "soaring" in the present tense. I don't think so. I think "soaring" carries a strong connotation of already being way up in the air, or ascending very materially and rapidly. I don't think 300kbd merits that term. I think, if we wanted to use a flight metaphor, we might reasonably say "has begun to take off" or even "looks set to soar". But I think the use of "soaring" in the present tense is an exaggeration. I think this fits in a long-standing pattern at the New York Times of distorted coverage in which positive oil market developments are over-hyped while negative ones are minimized.

Mining Magnate Gina Rinehart Bids For Editorial Control Of Australia's Fairfax Newspapers  

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Australia's print media is slowly collapsing under pressure from the internet (holding out a little longer than their peers in the US) - unfortunately this means deep-pocketed mining magnates / conservative fruit loops like Gina Reinhart can take over the remnant liberal sections of the media and convert them into yet another arm of the right wing noise machine. DeSmogBlog has a look at the fate of Fairfax - Mining Magnate Gina Rinehart Bids For Editorial Control Of Australia's Fairfax Newspapers.

When you think the news stories just aren’t going your way – when parts of the media just refuse to tow your particular ideological line – what are your options?

For most people, the choices are limited. You could perhaps write a letter to the editor or maybe even pen an opinion piece or start your own blog.

But if you’re the world’s richest woman with a penchant for climate science denial and a coal and iron ore empire to maintain, then your options are considerably broader.

This week, the Australian oligarch Gina Rinehart took the logical step for someone with a personal fortune approaching $30 billion and bought the opposition.

The mining magnate now holds 19 per cent of all the shares in Fairfax – the Australian media organisation which owns the country’s most respected newspapers the Sydney Morning Herald, The Age (Melbourne) and the Australian Financial Review.

Rinehart has been increasingly vocal in her opposition to taxes on mining and the Labor Government’s carbon price legislation, while backing and promoting climate science doubt mongerers – even going as far as to appoint one to the board of two of her companies.

Beyond the publicly-funded ABC, in Australia Fairfax provides the only mainstream centre-left balance to much of the anti-environmental, climate sceptic rhetoric offered by the columnists in the Rupert Murdoch-owned News Ltd papers.

Rinehart is understood to be asking for three seats on the Fairfax board, one of which would likely be taken by her Canadian-born advisor Jack Cowin, the owner of the Hungry Jacks burger franchise who has said that Rinehart should be allowed to help set the group’s news agenda. Cowin is also a board member of Channel Ten alongside Rinehart, who owns a near 13 per cent stake in the television network.

Her tilt at Fairfax has prompted a flurry of outrage. Journalists at Fairfax revealed they had written a letter to Rinehart to ask for her assurance that she would sign the company’s 20-year-old “Charter of Editorial Independence” which ensures the company’s directors don’t dictate the news agenda. They have heard nothing back.

The “Charter of Editorial Independence” is signed by the company board and declares journalists should be free to go about their work “fairly, fully and regardless of any commercial, political or personal interests, including those of any proprietors, shareholders or board members.”

Senior Fairfax writer David Marr was under no illusions when he told reporters the charter and its principles were under threat. “It has protected readers, the community and it’s also protected the journalists,” he said, “and that is now what is under direct challenge by Ms Rinehart”. Sydney Morning Herald economics editor Ross Gittins hinted he could quit if Rinehart refused to sign the charter.

Former conservative Prime Minister Malcolm Fraser wrote in The Conversation that if politicians still regarded the print media as having an influence on public policy and opinion, then Rinehart’s bid would represent “policies sold to the highest bidder”.

So “what can we expect”, asked Fraser, rhetorically. “Policies that will support unbridled profits of great mining enterprises, perhaps policies not far short of those supported by the Tea Party and the Republican right in the United States. If this comes to pass, Australia will be effectively without independent print media.”

Marginal Oil Production Cost Nearing $92 Per Barrel  

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Future Pundit points to a Bernstein Research paper describing the marginal cost of oil production - Marginal Oil Production Cost Nearing $92 Per Barrel.

Energy analysts at Bernstein say the marginal cost of oil production, already $92 per barrel, is nearing $100 per barrel.
The marginal cost of the 50 largest oil and gas producers globally increased to US$92/bbl in 2011, an increase of 11% y-o-y and in-line with historical average CAGR growth. Assuming another double digit increase this year, marginal costs for the 50 largest oil and gas producers could reach close to US$100/bbl.
Their analysis does not include OPEC or former Soviet Union producers. But this does not matter. Since the former SU and OPEC aren't going to grow their production fast enough to meet rising world demand the marginal cost of the other producers will determine at what price rising demand and market price will meet.

This rapidly rising marginal cost of production is what Peak Oil looks like. Peak Oil is going to happen because marginal cost will go too high for the world economy to afford to pay what it takes to boost production. At that point oil production will start falling. I originally expected peak production to happen at a much higher price for oil. But the European debt crisis, the deceleration of Chinese economic growth, and the continued weak US economic recovery make me think peak global oil production will happen at a price not much higher than current oil prices.

The costs of tight shale oil is very high and high oil prices are needed to keep it flowing.

"The United States is producing an awful amount of oil from tight shale and tight sands reservoirs... If oil prices send a signal and drop below the $90-$80 level it is going to be uneconomic to drill those well. So drilling will stop immediately," said Michel Hulme, fund manager at Lombard Odier.
How high an oil price is needed to start world oil demand headed on a downward slope? Higher or lower than the current price range near $90-100?

Historic Day for Tidal Energy in the US  

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SustainableBusiness.com reports that the first power purchase agreement for tidal power in the US has been signed in Maine - Historic Day for Tidal Energy in the US.

Maine regulators have directed three utilities to buy 4 megawatts (MW) of tidal electricity from Ocean Renewable Power Company, making it the first state to commercialize ocean energy.

Installation of the first unit began in March and in Cobscook Bay and will be finished by late summer, feeding electricity to the grid by October 1.

In fall 2013, the company will add four more devices with a total capacity of 900 kilowatts, enough to power about 100 homes.

The 4 MW project will suppy electricity for over 1000 homes by 2016.

The Maine Public Utilities Commission (PUC) approved a term sheet for the nation's first power purchase contract for tidal energy, to be in place for 20 years.

The term sheet sets the price to be paid for tidal power at 21.5 cents per kilowatt hour, much higher than typical rates of 11-12 cents. The rate will rise 2% a year and makes the project feasible.

In making the decision, regulators looked at what the cost of fossil fuels would be over 20 years and decided they would likely be even higher. In fact, they see tidal energy being cost-competitive in as little as five years.

The International Energy Agency's International Vision for Ocean Energy sets a goal for the technology to be cost-competitive by 2020.

France bans Syngenta pesticide linked to bee decline  

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Farmers Weekly has a report on a French ban on pesticides linked to declining bee populations - France bans Syngenta pesticide linked to bee decline.

The French government has banned a pesticide linked to the decline of bees that is widely used to treat oilseed rape. Cruiser OSR, which contains the neonicotinoid insecticide thiamethoxam, was banned for use on oilseed rape by the French Ministry of Agriculture. Made by the Swiss agrichemical company Syngenta, Cruiser OSR is a seed treatment, which is coated onto the rape seeds.

The decision to ban Cruiser follows two studies earlier this year, in the UK and France, which found evidence that neonicotinoids contain chemicals that disorientate bees and prevent them from finding their way back to hives, causing colony collapse disorder. Announcing the ban, France's Ministry of Agriculture said it would be pushing for a European-wide ban with the European Commission and the European Food Safety Agency (EFSA).

Bees are vitally important to agriculture for pollinating our food crops and maintaining biodiversity in the rural environment. A recent Friends of the Earth report estimated bees are worth £510m a year to the UK economy. However, bee numbers have been declining worldwide in recent years and conservationists claim that pesticides are a contributing factor, in particular neonicotinoids.

Largest tidal array in the world to be built in Scotland  

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Wired has a report on the progress of tidal power in Scotland - Largest tidal array in the world to be built in Scotland.

Western Scotland will see the world's largest tidal array constructed off the coast, as the first large-scale rollout of tidal energy generation.

A trial with one 30m turbine, the HS1000, anchored to the ocean floor in a fast-flowing channel near the Orkney Islands, raised one megawatt of electricity -- enough to power around 500 homes. Now, Scottish Power is planning on building two farms of turbines off the Scottish coast.

The project at the Sound of Islay should hopefully generate 10MW, and then the later project off Duncansby Head (the most northeasterly point of Scotland) should generate around 95MW. While individual turbines have been trialled across the world, the arrays will be the largest of their kind, with local communities having their power provided by renewable tidal sources.

The turbines -- built by Andritz Hydro Hammerfest, a Norwegian firm -- represent a tricky engineering challenge. Considerations for wild plants and fish means that the blades can't move too fast, and the turbines must be located in areas where there is a reliably fast current travelling at at least 2.5m/s (such as the Sound of Islay, a narrow passage between the Scottish mainland and the island of Jura).

Once a suitable location has been identified, a giant steel frame is lowered to the seabed and secured. The turbines are between 40 to 100 metres below the surface of the sea, so theoretically pose no danger to shipping. The turbines are designed to turn in both directions to generate power, giving a constant supply of electricity.

Some have estimated that around ten percent of the UK's total energy needs could be met with tidal arrays -- and the long-dreamed-of Severn Barrage alone could meet five percent of UK demand if numerous engineering difficulties are overcome.

As with many renewable energy technologies, the initial costs can be prohibitive. Scottish Power estimates the cost of the turbine farm to be around £70 million.

The Intersection Of Information And Energy  

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Technology Review has a series of reports on the intersection of computing and the electrical grid, including this article by eSolar's Bill Gross on improving the price and performance of solar thermal power plants - a textbook example of Bucky Fuller's concept of "ephemeralization" - The Intersection Of Information And Energy.

I believe that we will need great ingenuity to enable our planet to provide successfully for more than seven billion human beings, let alone the nine billion that will probably inhabit it by 2050, and I believe that information technology will make this ingenuity possible. Because of fluid marketplaces and an ever more globalized economy, nearly every important resource is becoming scarcer and more costly. Evidence of this is seen in the price not only of oil but also of aluminum, concrete, wood, water, rare-earth elements, and even common elements like copper. Everything is getting more expensive because billions of people are trying creatively to repackage and consume these materials. But there is one resource whose price has consistently has gone down: computation.

The power, cost, and energy use involved in one unit of computation is declining at a more consistent, dependable rate than we have seen with any other commodity in human history. That declining cost curve must be tapped to lower energy prices—and I believe it will be. This will happen as people ask: To achieve my purpose (in designing whatever device or system), can I use more "atoms" or more "bits" (computation power)? The choice will have to be bits, because atoms are going up in price while bits are going down.

Here are a few examples. When designing a car, one can put a bit more effort into stronger, lighter-weight materials, which will increase energy efficiency but possibly drive up cost; or one can put a lot more effort into using computational power to run simulations that optimize the use of materials. Today, computational fluid dynamics allow a designer to accurately design a new shape of car, put it in a computer wind tunnel instead of a physical one, and test 1,000,000 body designs to improve fuel mileage by significant amounts. This was never before possible for those constructing vehicles.

In solar energy, large fields of mirrors or photovoltaic panels can be optimized to be lighter, more reliable, and more power-efficient by putting a $2 microprocessor in every panel. An onboard computer that lets each panel track the sun independently replaces previous systems that used more steel, bigger gears, and bigger gearboxes—basically, more materials. As little as 10 years ago, the computing power and sensors needed to build a closed-loop, sun-tracking solar panel might have cost $2,000, or more than the panel itself, and thus the system would not have been cost effective. But with computing costs coming down by a factor of 1,000 every 15 years, all kinds of new opportunities arise to improve system design.

At eSolar, one of our companies, we designed and built a utility-scale solar-thermal power plant with a huge amount of computation embedded into the field of mirrors. We reduced the size of the components, cut the installation expense, and drove the cost of the system down to nearly half what had been achieved before. This experience proved to me the feasibility of replacing atoms with bits.

The price reduction curve for computing is not over—it's continuing, and each year will open up further avenues for ingenuity. That is important because our current energy resources are not at all easy to compete with. Fuels that we dig out of the ground and burn are extremely cheap. They are, in effect, the concentrated storage of millions of years of sunlight falling on Earth. Ironically, the biggest component of energy costs is the expense of moving the fuel to consumers from where it's obtained—and transportation costs are mostly fuel, too. So we are in a kind of vicious cycle. The way to break free of fossil fuels is to introduce something new to our energy equation that isn't fuel.

I believe ingenuity in the form of information technology is the only variable that offers sufficient leverage. We need to replace a cheap, unsustainable form of energy with sustainable forms of energy that are equally cheap. The only way to compete with cheap fuels is to be more clever with computation; that is, to use as little of anything else as possible.

A peak oil follower despairs of his movement's future  

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Platts has picked up on a blog post from TOD's Luis De Sousa, wondering what will become of the ASPO, an organisation which seems to be past peak - A peak oil follower despairs of his movement's future.

When OPEC officials meeting in Vienna are talking about "tremendous" surpluses of oil in the world, and US crude production has risen above 6 million b/d, it's tough to be a disciple to the peak oil school of the future.

Ask Luis de Sousa. This Portugese member of the the Association for the Study of Peak Oil has just returned from the recent ASPO meeting in Vienna, and he is not optimistic that the movement has a great deal of energy left in it.

It certainly isn't for lack of belief in the ultimate imbalance between the world's ability to produce oil, and its desire to consume it, which is what is at the heart of the peak oil school of thought.

De Sousa makes clear in a recent blog posting that was circulated by some other peak oil followers that he is very much still a believer.

For example, looking at the European debt crisis, he sees energy as having played a role: "Unfortunately, the role oil, coal and food prices had (and still have) in the economic crisis is not acknowledged by everyone, not even within ASPO. This is a terrible mistake, for it is exactly [the] way Peak Oil looks like. Getting ourselves intertwined in the debt or peak demand discourse is a self defeating path that will veer policy makers away from addressing the structural weakness of our economies. It is never too much to remind that the states today cut off from the European sovereign debt market are precisely those that were most dependent on oil before the crisis. "

So de Sousa's disullisionment is more like a parishioner at a church who sees the pews slowly emptying over time, and despairs of it ever reversing. For example, he writes: "But after 10 years of activity ASPO's message has failed to pass. Policy makers, climatologists, energy Industry, by and large are all yet to fully acknowledge the problem and its implications."

Or maybe it's more from the perspective of being in Portugal, a country in some degree of economic crisis, where at this point they'd probably be happy to have a rising level of energy consumption. As De Santos writes of his country: "Energy consumption is declining to levels of 15 or 20 years back, with most mechanisms once put in place for the energy transition being rolled back one after the other. As [a] founding member of ASPO-Portugal I can only take this as failure. It was precisely to avoid this kind of scenario that I started working on Peak Oil in 2005. But here we are; the efforts of the handful of people making up our association are now largely irrelevant. The media and the politicians that once showed interest on the subject are gone, and so are we."

Ironically, I just received notification of this year's ASPO-US conference. One notable change: it isn't in Washington. For a few years the gathering was mostly sited in Denver, after which the locale was switched to Washington, ostensibly to be near the seat of power. But this year it will be in Austin, the heart of academia.

It's an interesting move, and de Santos seems to foreshadow something like it when he writes: "Many of us question ourselves what future ASPO can have in the present setting. It can either remain a loose scientific organisation or push a more political structure to lobby on the institutions that have the means to act. I don't think ASPO should take the latter path, but more than that, it seems that it is presently unable to do so."

As far as De Sousa is concerned, he'll still continue to attend the international meetings, but he appears somewhat disillusioned: "There will be an ASPO conference in 2013, with the work for its realisation already under way. And I will probably be there too. But not any more as an avid information seeker, dreaming of saving the world, it will be just to see old friends and make new ones. After all, that was always the best about ASPO conferences."

Who owns Australia's gas ?  

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The Business Spectator has a look at efforts to try to reserve some of Australia's natural gas production for domestic consumption - Who owns Australia's gas?.

It’s on for young and old between the gas supply industry and the major gas users, with the latter continuously ratcheting up the heat.

In fact, it is a three-cornered contest now because both the federal government and the Coalition have signalled that they don’t want to intervene to reserve gas supplies for domestic use while the users are enlisting heavy hitters, such as Dow Chemical’s main man, Andrew Liveris, to tell them they are wrong.

In a new fusillade, the Perth-based DomGas Alliance, which started life as a Western Australian lobby group but is now chasing its concerns nationwide, has launched a report claiming that Australia is the only country in the world allowing “international oil companies to access and export natural gas without prioritising local supply.”

It sharpens its thrust by adding that Australia is also the only gas exporting country to experience shortages and sharply rising prices.

In a national economic environment where, no matter how often Wayne Swan exhorts us all to be happy, there are a large number of people unconvinced that they are sharing in the creation of new wealth and where manufacturers are obviously in strife, DomGas is pressing hard to get political knees to jerk at the state and federal level.

The cost-of-living button is always a good one to push in these disputes and DomGas has given it a good nudge with a claim that we are confronted with a rise of $5.3 billion in mainland state annual gas bills. (Why did they ignore poor Tassie, I wonder?)

DomGas bases this assertion on multiplying current gas demand by businesses and households with projected price rises – of $3 per gigajoule in the east and $5.50 in Western Australia.

The debate about higher gas costs (and higher electricity prices flowing from the use of gas by power stations) is not new in the West. It has been ongoing for several years.

However, driving this tale in to the media on the east coast is calculated to really pour on the pressure for the pollies, with a federal election looming and the big three states (in terms of consumers and consumption) all now in Coalition hands and manifestly jumpy about energy bills.

IEA: we’re on track for 6 degree warming  

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The Climate Spectator has a look at the latest publication emanating from the IEA - IEA: we’re on track for 6 degree warming.

You can’t get much starker a statement than the one from International Energy Agency head Maria van der Hoeven, in relation to the latest edition of the IEA’s Energy Technology Perspectives publication:

"Let me be straight. Our ongoing failure to realise the full potential of clean energy technology is alarming. "Continued heavy reliance on a narrow set of technologies and fossil fuels is a significant threat to energy security, stable economic growth and global welfare, as well as to the environment."

This is the fourth edition of the IEA’s Energy Technologies Perspective report, which attempts to map out what kind of transformation of our energy sector we would need to make in order to limit global warming to tolerable levels. This edition outlines a mix of technological solutions that are not all that different to what they have projected in the past:

-- Energy efficiency can deliver the largest, fastest and cheapest emission reductions.
-- Renewables have a large role to play and will grow to be a major source of supply if we implement policy to limit global warming to 2 degrees Celsius.
-- Natural gas will be important as a complement to the variability of some renewables and provide an important lower emission substitute for coal. ...

But the particular highlight, or to be more precise, lowlight, of this report is that if governments don’t do something urgently to wean ourselves off fossil-fuels, we’ll most likely end up with global temperature rise of six degrees Celsius.

According to a 2010 paper by Sherwood and Huber, published in the Proceedings of the National Academy of Science, such a temperature rise would mean significant parts of the globe would be so hot and importantly humid, that it would be beyond humans to successfully adapt. We simply can’t risk this kind of extreme temperature rise.

What’s more, while avoiding this disaster would require very huge investments in energy supply and usage ($36 trillion more from today to 2050), it would deliver fuel savings that would outweigh the additional investments by $3 to $1. Even with a 10 per cent discount rate, we’d end up with a net benefit of $US5 trillion, according to the IEA.

Unfortunately, the IEA says nine out of ten technologies that hold potential for major energy and CO2 emissions savings are failing to be deployed at the scale required. Hydro, biomass, onshore wind and solar photovoltaics are making sufficient progress, but several others are not. The IEA is particularly worried about slow uptake of energy efficiency, offshore wind and concentrated solar power but perhaps most of all it’s worried about the complete lack of progress for carbon capture and storage of emissions from fossil fuel combustion.

3-D Transistors  

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Technology Review has a look at energy efficient advances in chip design - 3-D Transistors.

In an effort to keep squeezing more components onto silicon chips, Intel has begun mass-producing processors based on 3-D transistors. The move not only extends the life of Moore's Law (the prediction that the number of transistors per chip will double roughly every two years) but could help significantly increase the energy efficiency and speed of processors.

The on-and-off flow of current in conventional chips is controlled by an electric field generated by a so-called gate that sits on top of a wide, shallow conducting channel embedded in a silicon substrate. With the 3-D transistors, that current-carrying channel has been flipped upright, rising off the surface of the chip. The channel material can thus be in contact with the gate on both its sides and its top, leaving little of the channel exposed to interference from stray charges in the substrate below. In earlier transistors, these charges interfered with the gate's ability to block current, resulting in a constant flow of leakage current.

With virtually no leakage current, a transistor can switch on and off more cleanly and quickly, and it can be run at lower power, since designers don't have to worry that leakage current could be mistaken for an "on" signal.

Intel claims the new transistors can switch up to 37 percent faster than its previous transistors or consume as little as half as much power. Faster switching means faster chips. In addition, because of their smaller footprint, the transistors can be packed closer together. Signals thus take less time to travel between them, further speeding up the chip.

Crude and Condensate Reached New Highs in Jan  

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Stuart at Early Warning has a post on global oil production, showing oil production has managed to reach a new high after a long plateau - Crude and Condensate Reached New Highs in Jan.

The EIA helpfully produces a breakdown of the global liquid fuel supply into components. This allows us to distinguish change in the supply of "oil" - narrowly defined as crude oil plus condensates (hydrocarbons which come out of the ground as liquid) - from changes in other things (natural gas "liquids", most of which are actually gases like ethane, propane, and butane, ethanol, and refinery volume changes.

The above graph shows these four substreams - the crude and condensate (C&C) is on the right scale and the others on the left scale. This approach is designed to make it easiest to compare changes. The interesting news is that crude+ condensate, which has been pretty much plateaued since late 2004, has now made new highs. So clearly "peak monthly oil" is not behind us.

At the same time, the data still seem to me to be consistent with the overall "peak oil moderate" worldview - that in 2005 we entered into a situation in which it became very difficult to raise oil production and that placed significant constraints on the global economy and made recessions more likely, but that the decline in global production will be slow and fears that this would lead to an abrupt collapse of the global economy were overblown (the "doomer" view).

At the moment, the plateau in C&C has a slight upward tilt and it's not possible to say declines in global oil production have begun.

Abundance or the Earth Is Full ?  

Posted by Big Gav

TED has a contrasting pair of talks up - Paul Gilding explaining the doomer vision of the future in The Earth is full vs Peter Diamandis' more optimistic vision, Abundance is our future.

Have we used up all our resources? Have we filled up all the livable space on Earth? Paul Gilding suggests we have, and the possibility of devastating consequences, in a talk that's equal parts terrifying and, oddly, hopeful.

Paul Gilding is an independent writer, activist and adviser on a sustainable economy. Click through to watch the onstage debate that followed this talk.

Onstage at TED2012, Peter Diamandis makes a case for optimism -- that we'll invent, innovate and create ways to solve the challenges that loom over us. "I’m not saying we don’t have our set of problems; we surely do. But ultimately, we knock them down.”

Peter Diamandis runs the X Prize Foundation, which offers large cash incentive prizes to inventors who can solve grand challenges like space flight, low-cost mobile medical diagnostics and oil spill cleanup. He is the chair of Singularity University, which teaches executives and grad students about exponentially growing technologies.

Ultra-Efficient Solar  

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Technology review has a look at Semprium's approach to high efficiency solar cells using concentrating lenses and gallium arsenide cells - Ultra-Efficient Solar.

This past winter, a startup called Semprius set an important record for solar energy: it showed that its solar panels can convert nearly 34 percent of the light that hits them into electricity. Semprius says its technology, once scaled up, is so efficient that in some places, it could soon make electricity cheaply enough to compete with power plants fueled by coal and natural gas.

Because solar installations have many fixed costs, including real estate for the arrays of panels, it is important to maximize the efficiency of each panel in order to bring down the price of solar energy. Companies are trying a variety of ways to do that, including using materials other than silicon, the most common semiconductor in solar panels today.

For example, a startup called Alta Devices (see the TR50, March/April 2012) makes flexible sheets of solar cells out of a highly efficient material called gallium arsenide. Semprius also uses gallium arsenide, which is better than silicon at turning light into electricity (the record efficiency measured in a silicon solar panel is about 23 percent). But gallium arsenide is also far more expensive, so Semprius is trying to make up for the cost in several ways.

One is by shrinking its solar cells, the individual light absorbers in a solar panel, to just 600 micrometers wide, 600 micrometers long, and 10 micrometers thick. Its manufacturing process is built on research by cofounder John Rogers, a professor of chemistry and engineering at the University of Illinois, who figured out a way to grow the small cells on a gallium arsenide wafer, lift them off quickly, and then reuse the wafer to make more cells. Once the cells are laid down, Semprius maximizes their power production by putting them under glass lenses that concentrate sunlight about 1,100 times.

Concentrating sunlight on solar panels is not new, but with larger silicon cells, a cooling system typically must be used to conduct away the heat that this generates. Semprius's small cells produce so little heat that they don't require cooling, which further brings down the cost. Scott Burroughs, Semprius's vice president of technology, says utilities that use its system should be able to produce electricity at around eight cents per kilowatt-hour in a few years. That's less than the U.S. average retail price for electricity, which was about 10 cents per kilowatt-hour in 2011, according to the U.S. Energy Information Administration.

Global Solar Growth Continued Strong in 2011  

Posted by Big Gav

Stuar at Early Warning has a look at the growth of solar power worldwide - Global Solar Growth Continued Strong in 2011.

That is a pretty extra-ordinary growth curve. Seeing what is already a decent sized industry ($82 billion in 2010) with a linearly increasing growth rate this high is an amazing thing.

It's not certain how long this will continue however:

European markets where PV has developed vigorously in recent years have reached, at least for the time being, a level that will be difficult to maintain in the two coming years. The market slowdown in Europe will not immediately be offset by market growth elsewhere in the world, but a rebalancing has begun. New markets around the world will have to be opened up to drive PV development in the coming decade just as Europe accounted for it until now.

Many existing markets – in particular China, the USA and Japan, but also India – have addressed only a very small part of their enormous potential for PV development. Moreover, several countries from large sunbelt regions like Africa, the Middle East, South East Asia and South America are on the brink of starting their development, pushed by an increasing awareness of solar PV potential. As a whole, the global PV market will grow more sustainably, driven by the competitiveness of PV solutions rather than mainly by financial support schemes. But this Paradigm Shift will not happen overnight.

4 Man Bike;1948  

Posted by Big Gav

Amory Lovins: A 40-year plan for energy  

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TED Talks has a new talk up from Amory Lovins - Amory Lovins: A 40-year plan for energy.

In this intimate talk filmed at TED's offices, energy innovator Amory Lovins shows how to get the US off oil and coal by 2050, $5 trillion cheaper, with no Act of Congress, led by business for profit. The key is integrating all four energy-using sectors—and four kinds of innovation.

Amory Lovins was worried (and writing) about energy long before global warming was making the front -- or even back -- page of newspapers. Since studying at Harvard and Oxford in the 1960s, he's written dozens of books, and initiated ambitious projects -- cofounding the influential, environment-focused Rocky Mountain Institute; prototyping the ultra-efficient Hypercar -- to focus the world's attention on alternative approaches to energy and transportation.

His critical thinking has driven people around the globe -- from world leaders to the average Joe -- to think differently about energy and its role in some of our biggest problems: climate change, oil dependency, national security, economic health, and depletion of natural resources.

Lovins offers solutions as well. His new book and site, Reinventing Fire, offers actionable solutions for four energy-intensive sectors of the economy: transportation, buildings, industry and electricity. Lovins has always focused on solutions that conserve natural resources while also promoting economic growth; Texas Instruments and Wal-Mart are just two of the mega-corporations he has advised on improving energy efficiency.

Why the Global Warming Skeptics Are Wrong  

Posted by Big Gav in

The New York Review Of Book has an article by William Nordhaus on global warming - Why the Global Warming Skeptics Are Wrong.

The threat of climate change is an increasingly important environmental issue for the globe. Because the economic questions involved have received relatively little attention, I have been writing a nontechnical book for people who would like to see how market-based approaches could be used to formulate policy on climate change. When I showed an early draft to colleagues, their response was that I had left out the arguments of skeptics about climate change, and I accordingly addressed this at length.

But one of the difficulties I found in examining the views of climate skeptics is that they are scattered widely in blogs, talks, and pamphlets. Then, I saw an opinion piece in The Wall Street Journal of January 27, 2012, by a group of sixteen scientists, entitled “No Need to Panic About Global Warming.” This is useful because it contains many of the standard criticisms in a succinct statement. The basic message of the article is that the globe is not warming, that dissident voices are being suppressed, and that delaying policies to slow climate change for fifty years will have no serious economic or environment consequences.

My response is primarily designed to correct their misleading description of my own research; but it also is directed more broadly at their attempt to discredit scientists and scientific research on climate change.1 I have identified six key issues that are raised in the article, and I provide commentary about their substance and accuracy. They are:

• Is the planet in fact warming?
• Are human influences an important contributor to warming?
• Is carbon dioxide a pollutant?
• Are we seeing a regime of fear for skeptical climate scientists?
• Are the views of mainstream climate scientists driven primarily by the desire for financial gain?
• Is it true that more carbon dioxide and additional warming will be beneficial?

As I will indicate below, on each of these questions, the sixteen scientists provide incorrect or misleading answers. At a time when we need to clarify public confusions about the science and economics of climate change, they have muddied the waters. I will describe their mistakes and explain the findings of current climate science and economics. ...

Shale Gas: The View from Russia  

Posted by Big Gav in ,

While I wouldn't view Dmitri Orlov or Gazprom as unbiased observers of the global gas industry, this post at Club Orlov is quite thought provoking - Shale Gas: The View from Russia.

The official shale gas story goes something like this: recent technological breakthroughs by US energy companies have made it possible to tap an abundant but previously inaccessible source of clean, environmentally friendly natural gas. This has enabled the US to become the world leader in natural gas production, overtaking Russia, and getting ready to end of Russia's gas monopoly in Europe. Moreover, this new shale gas is found in many parts of the world, and will, in due course, enable the majority of the world's countries to achieve independence from traditional gas producers. Consequently, the ability of those countries with the largest natural gas reserves—Russia and Iran—to control the market for natural gas will be reduced, along with their overall geopolitical influence.

If this were the case, then we should expect the Kremlin, along with Gazprom, to be quaking in their boots. But are they?

Here is what Gazprom's chairman, Alexei Miller, recently told Süddeutsche Zeitung: “Shale gas is a well-organized global PR-campaign. There are many of them: global cooling, biofuels.” He pointed out that the technology for producing gas from shale is many decades old, and suggested the US turned to it out of desperation. He dismissed it as an energy alternative for Europe. Is this just the other's sides propaganda, or could Miller be simply stating the obvious? Let's explore. I will base my exploration on Russian sources, which is why all the numbers are in metric units. If you want to convert to Imperial, 1 m3 = 35 cubic feet, 1 km2 = .38 square miles, 1 tonne = 1.1 short tons).

The best-developed shale gas basin is Barnett in Texas, responsible for 70% of all shale gas produced to date. By “developed” I mean drilled and drilled and drilled, and then drilled some more: just in 2006 there were about as many wells drilled into Barnett shale as are currently producing in all of Russia. This is because the average Barnett well yields only around 6.35 million m3 of gas, over its entire lifetime, which corresponds to the average monthly yield of a typical Russian well that continues to produce over a 15-20 year period, meaning that the yield of a typical shale gas well is at least 200 times smaller. This hectic activity cannot stop once a well has been drilled: in order to continue yielding even these meager quantities, the wells have to be regularly subjected to hydraulic fracturing, or "fracked": to produce each thousand m3 of gas, 100 kg of sand and 2 tonnes of water, combined with a proprietary chemical cocktail, have to be pumped into the well at high pressure. Half the water comes back up and has to be processed to remove the chemicals. Yearly fracking requirements for the Barnett basin run around 7.1 million tonnes of sand and 47.2 million tonnes of water, but the real numbers are probably lower, as many wells spend much of the time standing idle.

In spite of the frantic drilling/fracking activity, this is all small potatoes by Russian standards. Russia's proven reserves of natural gas amount to 43.3 trillion m3, which is about a third of the world's total. At current consumption rates, that's enough to last 72 years. Russian gas production is constrained by demand, not by supply; it is currently down simply because Eurozone is in the midst of an economic crisis. Meanwhile, US production has surged ahead, for no adequately explored reason, crashing the price and making much of it unprofitable.

Let's compare: Gazprom's price at the wellhead runs from US$3 to $50 per thousand m3, depending on the region. Compare that to shale gas in the US, which runs from $80 to $320 per thousand m3. At this price, the US cannot afford to sell shale gas on the European market. Moreover, the overall volume of shale gas being produced in the US, even given the feverish drilling rate of the past couple of years, if cleaned up, liquified, and shipped to Europe in LNG tankers, would not be enough to book up just the LNG terminal in Gdańsk, Poland, which is currently standing idle. It seems that Gazprom has little to worry about.

The US, on the other hand, does have plenty to worry about. There has been much talk already about groundwater pollution and other forms of environmental destruction that accompanies the production of shale gas, so I will not address these here. Instead, I will focus on two aspects that are just as important but have received scarcely any attention.

First, what is shale gas? Ask this question, and you will be told: “Shut up, it's methane.” But is it really? The composition of shale gas is something of a state secret in the US, but information about the gas produced from the nine Polish shale gas test projects did leak out, and it's not pretty: Polish shale gas turned out to be so high in nitrogen that it does not even burn. Technology exists to clean up gas that is, say, 6% nitrogen, but Polish shale gas is closer to 50% nitrogen, and, given high production costs, low yields, rapid depletion and low wellhead pressure, cleaning it up to bring it up to spec (which is 1% nitrogen) would most likely result in a net waste of energy.

Even if shale gas is low enough in nitrogen to burn, the problems do not end there. It may also contain hydrogen sulfide, which is toxic and corrosive and has to be removed before the gas can be stored or injected into a pipeline. It probably contains toluene and other organic solvents—ingredients in the fracking cocktails—which are carcinogenic. Lastly, it may be radioactive. All clays are mildly radioactive, and shale is a sort of heat-treated clay. While Barnett shale is not particularly radioactive, Marcellus shale, which has recently been the focus of frantic drilling activity, is. Thanks to Marcellus shale gas, radioactive radon gas is being delivered directly to your kitchen, via the burners of your stove, or to a power plant smokestack upwind from where you live. This is expected to result in increased lung cancer rates in the coming years.

Second, why is shale gas being produced at all? Natural gas prices have fallen through the roof, and are currently around $2 per thousand cubic feet. This works out to around $70 per thousand m3. If shale gas costs from $80 to $320 per thousand m3 to produce, it is unclear how one might make any money with it.

But perhaps making money with it is not the point. What if shale gas is just a PR campaign (with horrific environmental side effects)? Going back to what Alexei Miller said, what if the entire point of the exercise was to increase the capitalization of shale gas exploration and production companies? The number one company in shale gas is Chesapeake Energy, the owner of the Barnett basin and a major player in the Marcellus basin. This company almost went bankrupt in 2009, but then managed to claw its way back to profitability in 2010 and 2011 by drilling, and drilling, and drilling, and then drilling some more. Sixty percent of their revenue is from drilling operations. And now there is a scandal involving Chesapeake Energy's (former?) chairman, Aubrey K. McClendon, who apparently awarded himself a stake in each well his company drilled, used them as collateral for billions in loans, and used the loans to bet that natural gas prices will go up (they haven't). In the meantime, natural gas drilling rig count has dropped to a ten-year low. Given that shale gas wells deplete very quickly, it looks like the shale gas boom is over.

But now that it's over, what was it, exactly? It appears to have been something like the dot-com bubble: companies with no conceivable way of turning a profit using hype to attract investment and drive up their valuations. Since 2008, various kinds of hype-based market manipulations have become the staple of economic life in the US, and so this is nothing new or different.

One interesting question is, What sort of bubble will the US attempt to blow next, if any? There is the Facebook IPO coming up. Facebook is a ridiculous time-waster and, as such, seems a bit overpriced. Are we going to attempt blowing up another dot-com bubble? Another round of subprime mortgages does not seem to be in the works. What's a bubble boy to do? If there are no more bubbles to blow, then it's back to just plain printing money.

So this whole shale gas thing didn't work out as planned, did it? But could it have? Had it turned out to be much better in every way, could it have swung geopolitical influence away from Russia and Iran and back toward the US? Alas, no.

You see, there is no such thing as a global natural gas market. Yes, there are some LNG tankers sailing about, but that is very much a point-to-point trade. There is a closed North American market, a European market, and another market in the Asia-Pacific region. These markets do not interact. The North American market and the European market could have potentially shared just one producer: Qatar. Qatar once wanted to export LNG to the US, but then decided to export it to Europe instead, generating less of a loss, because European gas prices are substantially higher. And the reason Qatar is dumping natural gas in Europe is because it has gas to dump: its northern gas field is a very “wet” field, with a substantial percentage of natural gas condensate. Qatar's OPEC quota is 36-37 million tonnes of oil per year, but natural gas condensate is not considered to be oil and is not covered by OPEC quotas. Exploiting the condensate loophole allows Qatar to export 65.7 million tonnes: 77% over quota. The LNG is just concomitant production, and Qatar can afford to export LNG to Europe at a loss. This is a juicy bit of trivia, but really something of a footnote: an exception that proves the general case: there is no global natural gas market.

Banff Mountain Film Festival 2011  

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One of my annual traditions is to go and see each year's Banff Mountain Film Festival.

This year's episode was as good as any, featuring some nifty urban skiing in Canada and some Nepalese guys paragliding down from the top of Mt Everest.

The two standout films from my point of view were "Kadoma", looking at some kayakers taking on first the White Nile then the Congo river, and "Sketchy Andy", highlighting the amazing skills and lunatic stunts of "professional slackliner" Andy Lewis.

Feeling peaky: The economic impact of high oil prices  

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The Economist has one of their occasional looks at peak oil theory - Feeling peaky: The economic impact of high oil prices.

AS THE developed-world economy tries to gain momentum, it faces a persistent headwind. The oil price remains stubbornly over $100 a barrel, acting like a tax on Western consumers. Some blame the high price on evil speculators—Barack Obama unveiled plans to increase penalties for market manipulation on April 17th. But there is a simpler explanation: that supply is inadequate to keep up with rising demand.

The concept of peak oil—the idea that global crude production may be at, or close to, its limit—is far from universally accepted. One leading asset manager talked recently of the world being “awash with energy” because of the exploitation of American shale gas. Nevertheless, oil is still the main fuel for cars and trucks. And crude output (as opposed to alternatives such as biofuels and liquids made from gas) has been flat since 2005.

A number of countries (including Britain, Egypt and Indonesia) have turned from net oil exporters into importers in recent years. And although rich countries have curbed their energy-guzzling a little, demand continues to surge in emerging markets.

This has left the oil market very vulnerable to temporary supply disruptions, such as the war in Libya. Speaking at a conference in Dublin this week, organised by the Institute of International and European Affairs and the Association for the Study of Peak Oil and Gas, Chris Skrebowski, a consulting editor of Petroleum Review, argued that spare capacity in the oil market could be eroded by 2015.

The peak-oil concept was devised by the late M. King Hubbert, who correctly predicted in 1956 that oil output in the lower 48 states of America would peak by around 1970. At the conference Michael Kumhof, an economist at the International Monetary Fund, presented the findings of a forthcoming working paper which showed that adding the idea of a “Hubbert peak” to energy production greatly improved the ability of a model to forecast oil prices. Based on an expected 0.9% annual increase in production over the next decade, the model predicts that real oil prices will nearly double over the same period.

The economic damage caused by such a rise is predicted to be modest, perhaps 0.2% of global GDP a year. In the past changes in oil prices have had a limited long-term impact, since any losses to oil importers are matched by gains by oil exporters. To the extent that high oil prices played a role in the recessions of the early 1980s and 2008-09, the main reason is that oil-producing countries tend to have a lower marginal propensity to consume their income, denting global demand.

Nevertheless, Mr Kumhof worries that if oil prices are high enough, the economic impact might increase substantially. On the most extreme assumptions, it could be 2% a year.

Even if the world can find more oil—in the Arctic or tar sands, say—the longer-term question is whether the era of “cheap energy” is over and how the world can adjust if it is. Developed economies are built on easy access to cheap energy, importing goods that are transported from around the world, with consumers driving many miles to work in air-conditioned offices and then flying off to sunny climes for their annual holidays. Persistently high oil prices would clearly lead to substitution (electric cars, natural-gas-powered trucks) but the transition costs could be significant.

Furthermore some potential substitutes for, or new sources of, oil (such as biofuels and tar sands) are a lot less efficient, in the sense that they require significant amounts of energy simply to produce. To the extent that this equation (energy return on energy invested, or EROI) is deteriorating, that must surely have an effect on economic growth.

Are the lights still on in South Australia ?  

Posted by Big Gav in ,

The Climate Spectator has a look at the increasing role of wind power in South Australia - Are the lights still on in South Australia?.

Yesterday, I called a friend of mine in Adelaide. Beyond the usual niceties to start the call my first question was: ‘is the power out?’ Perplexed, he answered in the negative, no doubt wondering whether I had control of my faculties.

It was a strange first question to come from a friend you haven’t spoken to for a month, after all. Especially from an avid Richmond supporter after the team’s biggest win in years. But I was concerned for the state of South Australia after receiving some interesting news during the day – wind now makes up 31 per cent of the state’s power supply, with solar PV accounting for another 3.5 per cent.

According to a leading energy advisory firm (Energy Quest), wind already “appears to be the new baseload.” Not bad in spite of the campaign against wind by they-who-shall-not-be-named. But while green groups were likely dancing in the streets, I was worried the lights in those streets might have gone out. I have been told for years that wind and solar are not capable of supplying power consistently enough to power one house, yet alone be able to supply a third of the energy needs for an entire state.

It appears to be all a Y2K-like false alarm however, with everything operating as normal. ...

Not only are wind and solar playing increasingly significant roles in the power grid, but they are also helping to make wholesale electricity prices cheaper. In the March quarter, wholesale electricity prices were between 30 and 60 per cent cheaper in the eastern states compared to a year ago. Energy Quest said the reasons for the wholesale price falls were “lower demand for grid power and the growth of wind and solar.”

South Australian wholesale prices fell 50 per cent, while the country’s most heavily reliant coal state, Victoria, only realised a price fall of 31 per cent. Average wholesale prices in Victoria, the only eastern state to have coal increase its output for the quarter, fell to $24.53/MWh from $35.50/MWh. South Australian prices fell to $26.17/MWh from $51.82/MWh. The gap is closing rapidly.

Obviously the switch to a sustainable energy future is a gradual one to be made over decades, not in the next year or two. But the progress with renewable energy in South Australia is promising and shows that with a friendly policy environment – for example, no 2km wind farm exclusion zones – great strides can be made.

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