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Being for Energy Independence v. Being Against Progress

Posted by Andrew Stevenson on July 14, 2009

Plenty of criticism and analysis has already been directed at Alaska Governor Sarah Palin’s cap-and-trade editorial in the WaPo today (see here, here, and here). Instead of jumping on the bandwagon, I’d like to juxtapose it against an alternative analysis of the American Clean Energy and Security Act (ACES) by my former Congressman Mark Kirk (R-IL), who voted in favor of the bill. I’m not trying to pretend that Sarah Palin and Mark Kirk fall at the exact same point on the political spectrum (nor am I trying to set up some sort of artificial debate between the two of them). Indeed, Kirk represents a moderate suburban Chicago district (although one that would be hard hit by increased taxes on the wealthy), has always been fairly green, and had further political incentives for the “Yes” vote given his upcoming run for statewide office.

However, it’s worth illustrating that while both share the same overarching policy objective—“an ‘all of the above’ energy strategy”—Kirk’s reasoned, experienced, fact-based, forward-looking and still very much conservative analysis led him to a very different place than Palin. My overall message to the Republican Party: please, please listen to the Mark Kirks in Congress when designing your strategy on climate and energy legislation, and not the Sarah Palins.

The Starting Point

Kirk: “For 2009, our top goal should be energy independence. I support exploring for energy off our coasts, expanding nuclear power and building a natural gas pipeline across Canada to lower heating costs in the Midwest…”

Palin: “We must move in a new direction. We are ripe for economic growth and energy independence if we responsibly tap the resources that God created right underfoot on American soil…Our 3,000-mile natural gas pipeline will transport hundreds of trillions of cubic feet of our clean natural gas to hungry markets across America. We can safely drill for U.S. oil offshore…”

Kirk and Palin seem to be agreed to the standard Republican “all of the above” energy strategy, focused on promoting domestic sources of energy and reducing America’s dependence on foreign oil.

The Experience

Kirk: “…the underlying ACES bill would still lower our dependence on foreign oil by diversifying American energy production. It is time to break the boom and bust cycle of high gas prices and the need to deploy three separate armies to the Middle East (Desert Storm, Iraqi Freedom and Enduring Freedom). As you may know, I am a veteran of the Desert Storm and Enduring Freedom missions.”In 1998 and 1999, I served as part of the U.S. delegation to both the Kyoto and Buenos Aires UN Climate Change conferences. In those years, there was a significant debate about the amount and effect of atmospheric carbon dioxide. I was a skeptic and spent hundreds of hours on the subject of 1990s climate science. In the Congress, our job is to learn as much as possible from the latest peer-reviewed non-partisan scientists and then plot the best course for our nation.”

Palin: Governor of a large, oil producing state (surely there are no perverse incentives there). Well, until she resigned.

You can’t fault Palin for looking out for her constituents, and supporting increased domestic oil and gas production. However, Kirk has seen firsthand the impacts of U.S. dependence on foreign oil when fighting for his country, and extensively studied climate science. Whose experience is more valuable when judging U.S. climate and energy policy options?

The Analysis

Kirk: “The National Academy of Sciences reports that the earth’s average temperature already increased by 1.4°F, from 56.8°F in 1920 to 58.2°F in 2007. NOAA also reports that due to a 30% drop in winter ice covering the Great Lakes since 1972, evaporation may be the cause of Lake Michigan’s declining water level…I am a strong supporter of the non-partisan Congressional Budget Office. When they reported the Democratic health care bill cost $1.6 Trillion, we should take notice and rewrite that bill. That is why I have become one of the leading Republican authors of an alternative health care bill that will be the Congress’s least expensive bill, costing our Treasury very little. I read their report on ACES carefully too. CBO reports that peer-reviewed scientists expect the world’s average temperature to increase by 9 degrees by 2100, lowering U.S. economic output by 3% annually. In sum, they estimated the costs of the bill per household at $140 annually.”

Palin: “The Americans hit hardest will be those already struggling to make ends meet. As the president eloquently puts it, their electricity bills will ‘necessarily skyrocket.’ So much for not raising taxes on anyone making less than $250,000 a year. Even Warren Buffett, an ardent Obama supporter, admitted that under the cap-and-tax scheme, ‘poor people are going to pay a lot more for electricity.’ ”

It’s perfectly reasonable for two intelligent, reasonable people to look at the same study and draw two different conclusions, based on their judgment of the underlying assumptions or methodologies. However, this was not the case here. Here we have a careful review of available non-partisan scientific and economic data specific to this exact piece of legislation versus unsubstantiated statements and generalized quotes. Once again, whose argument is more compelling?

The Conclusion:

Kirk: “In sum, I would have preferred a bill that focused more on energy independence and less on some of the complications in this bill. Nevertheless, the 1990 Clean Air Act signed by President Bush established a cap and trade system to reduce acid rain that proved to be a great low-cost success…In the coming Senate debate, I hope we can repeat this environmental success and aggressively back a national program to defund Iran and Venezuela by reducing America’s need for foreign oil.

Palin: “Can America produce more of its own energy through strategic investments that protect the environment, revive our economy and secure our nation? Yes, we can. Just not with Barack Obama’s energy cap-and-tax plan.”

Hmmm…somehow there seems to still be a disagreement between Kirk and Palin about the merits of ACES and the direction of America’s climate and energy policy. Based on their experience, evidence and analysis, I wonder whom to believe?

Posted in Cap and Trade, Energy, Uncategorized | Tagged: , , , | 4 Comments »

ET to the rescue

Posted by Danny Morris on May 14, 2009

Seriously people? We’ve been talking about energy and climate issues for years, and with all the brilliant people out there devising clever solutions, you’re telling me no one though of the most obvious solution? Of course I’m talking about stealing alien technology and using it for our benefit. Even though we’ve all dropped the ball, a lobbyist named Stephen Bassett is picking up the slack for us and Greenwire (sub req’d) reports on his crusade:

The government has in its possession “extraterrestrial vehicles,” lobbyist Stephen Bassett said. As in flying saucers.

Imagine the power source, he said, behind a 30-foot wide saucer that weighs the same as a tractor-trailer yet hurtles through galaxies at 20,000 miles per hour.

“What is the energy system operating that craft?” Bassett said. “They’re not burning kerosene.”

He added, “It eliminates oil. It eliminates coal. If it’s as good as we think it is, it transforms everything.”

No more ozone hole or melting polar ice caps, Bassett said. And the price of electricity would drop to almost nothing.

Bassett believes this. Fervently.

Well, I’m sold. It’s about damn time we stop importing energy from unstable parts of the world and starting utilizing energy we snake from much more stable civilizations in other solar systems. If Obama is truly the most popular leaderin the galaxy, then he should have no trouble negotiating with the Alpha Centarians for some friendly interstellar technology transfer. Bassett obviously agrees:

Those who believe the truth is out there have been waiting for someone like President Obama to come clean about the government hiding information on extraterrestrials, Bassett said. Obama would be “sensitive to the concerns of the military intelligence community,” Bassett said, plus he is popular worldwide, and he “has the intelligence to handle it.”

Bassett and fellow believers during the presidential campaign launched the “Million Fax on Washington” and have been sending Obama faxes and e-mails and leaving voice mail messages asking him to admit that E.T. is real. Documents should be released. There should be congressional hearings. And that spaceship technology should be made available to the public.

Next step: electric-dilithium crystal hybrids that go from 0 to 670,000,000 mph in 1.2 seconds and get XM radio.

Posted in Energy, Random, Space | 1 Comment »

Climate policy in China and the U.S.

Posted by Daniel Hall on February 5, 2009

China is in some ways the mirror image of the United States. Whereas in the United States the most serious efforts to date to address climate change have been made at the state and local levels and in the private sector, in China the major initiatives have come from the national-level party and government and have often been blunted by conflicting interests among local officials and enterprises.

That is Kenneth Lieberthal and David Sandalow in a new report from Brookings on the prospects for cooperation between China and the U.S. on climate change.  Here is an interesting tidbit on power generation in each country:

Coal remains king in China, and about 70% of power still comes from coal-fired plants. Over the past five years China has built the equivalent of America’s entire coal power generation system. These plants will stay on line for another 30-50 years while 60% of U.S. coal-fired power plants will be over 50 years old by 2025.

Here are the key recommendations from the executive summary.  The full report is worth reading — it is a very short and accessible 80 pages.  (It is much closer to an article from Foreign Affairs than a journal article, and yes that is a compliment.)  One of the themes running through the report is that it would be helpful to reframe the U.S.-China conversation around “clean energy” rather than “climate change.”

Posted in Climate Change, Energy, International | Leave a Comment »

Energy in 2009

Posted by Rich Sweeney on January 4, 2009

From The Economist:

Demand for oil in the rich world will fall in 2009 by around 1% because of elevated prices and slowing economic growth. Oil prices will average around $75 a barrel for Brent crude. The growth of oil demand in emerging markets will slow to 3.1%, with total global consumption edging up by only 0.7%. For suppliers, the picture will be far from bleak. OPEC’s capacity cushion will double to as much as 3.6m barrels a day and, outside OPEC, oil production will improve as Brazil, Azerbaijan and the US all boost capacity.

Coal’s share in global energy will continue to climb because of its relative cheapness and abundance, especially in the two largest coal-producing/consuming countries, the US and China. In the US, more coal-fired than gas-fired power plants will come on stream in the next two years. Globally, demand for coal will rise by 4.6% in 2009 to 6.8bn tonnes; this trend will gather speed as countries with large reserves aim to reduce their dependence on oil imports.

Demand for natural gas will accelerate, led by India, the rest of Asia and the Middle East. Natural-gas substitution in electric power generation and heating is gathering pace. Among alternative energy sources, solar panels suffered in 2008 because the price of pure silicon, the main component of most solar cells, hit record levels. But UK-based New Energy Finance expects the output of silicon for the solar industry to double in 2009, leading to a 40% price drop.

Posted in Energy | 1 Comment »

Maybe Carol Browner should dust off an old Atari 2600

Posted by Daniel Hall on December 18, 2008

In the beginning, Energy Czar can be frustrating. A newcomer to the program may often lose without understanding why.

The source is here.  The pointer is from Mike Giberson of Knowledge Problem, now ensconced over in fancy new digs at WP.

Update: I get pwned by Mike in the comments. You do know what that means, right Mike?

Posted in Energy | 5 Comments »

Waxman in at Energy and Commerce

Posted by Daniel Hall on November 20, 2008

Hopefully some discussion of what this might mean later, but for now, just the news.  Via E&E Daily:

Waxman unseats Dingell as Energy and Commerce chairman

Darren Samuelsohn, E&E Daily senior reporter

Rep. Henry Waxman (D-Calif.) is the new chairman of the House Energy and Commerce Committee.

Waxman ousted longtime Chairman John Dingell (D-Mich.), 137-122, in a secret ballot vote of the entire House Democratic Caucus today.

With Waxman’s victory, many expect the Beverly Hills Democrat to bring a liberal voice to the podium as he crafts energy and environmental legislation for the incoming Obama administration.

Waxman has not given many details of his proposed agenda, but a clear look at his record suggests he will pursue aggressive pollution cleanup for all industrial sectors, as well as some of the most aggressive limits for U.S. business as it embarks on a first-ever mandatory program to curb heat-trapping greenhouse gas emissions.

Since 2006, Waxman has made headlines as chairman of the House Oversight and Government Reform Committee, which has given him a perch to investigate the Bush administration’s policies on everything from Iraq and climate change to the use of steroids in Major League Baseball.

Some of Waxman’s biggest legislative accomplishments on the environment stretch back to before Republicans won control of Congress in 1994. He fought Dingell and the Reagan administration in the 1980s over efforts to weaken automobile emission standards. And during the 1990 Clean Air Act amendments debate, Waxman clashed with Dingell while serving as chair of the Health and Environment Subcommittee.

Waxman’s first order of business may be to address the hurt feelings within the divided caucus.

Rep. Rick Boucher (D-Va.), whose status as chairman of the Energy and Air Quality Subcommittee is now in doubt, said he was bothered by Waxman’s challenge. “This whole challenge bothered me but I won’t be specific about anything,” he told reporters.

“I think it was highly inappropriate, there was no obvious reason for it other than the desire for another person to chair the committee,” Boucher said. “There was no real substantive reason.”

Aides to Obama and House Speaker Nancy Pelosi (D-Calif.) stressed they had not played favorites or encouraged the move, but numerous pieces of tangential evidence suggested they would prefer Waxman over Dingell. Obama last weekend named longtime Waxman staffer Phil Schiliro as his top liaison to Congress. And Pelosi has fought countless times with Dingell over environmental issues, at one point backing his opponent in a Democratic primary.

At least one Democratic leader did speak up for Dingell’s cause: House Majority Leader Steny Hoyer (D-Md.). While speaking highly of Waxman at yesterday’s Steering and Policy Committee meeting, Hoyer expressed concerns about the precedent of removing a sitting chairman who was a loyal Democrat and an able performer, a Democratic aide said.

The Steering and Policy Committee endorsed Waxman by a 25-22 vote yesterday.

For Dingell, 82, the vote marks the end of Dingell’s 28 years as the top Democrat on the Energy and Commerce Committee, although he will have the title of chairman emeritus. Supporters of the congressman from the auto industrial hub of Dearborn, Mich., stressed his long list of accomplishments in Congress, as well as a renewed commitment to take on a broad array of President-elect Barack Obama’s priorities, including global warming.

His public list of supporters included more than a dozen Blue Dog Democrats, as well as members of the Congressional Black Caucus, New Democratic coalition and Democratic committee leaders.

Members who spoke on Dingell’s behalf at the Democratic caucus meeting included Reps. John Lewis of Georgia, Diana DeGette of Colorado, Stephanie Herseth Sandlin of South Dakota and Mike Doyle of Pennsylvania, according to Boucher. Waxman spoke on his own behalf for about five minutes.

Alex Kaplun and Ben Geman contributed.

Posted in 2008 Elections, Energy, Government Policy | 1 Comment »

Boon or bust?

Posted by Danny Morris on November 14, 2008

I know all of you out there are still as excited about the new World Energy Outlook2008 report as we are (see post below). Well in your euphoria, you might have missed this little tidbit from the IEA, courtesy of GreenWire:

The International Energy Agency today cut its global oil demand forecast by 0.8 percent, the largest reduction in 12 years.

Deteriorating world economic growth would drop demand by 670,000 barrels per day to 86.5 million barrels, the agency said in its monthly report today.

Less oil usage? If you were looking for a silver lining on our current financial meltdown, might this be it? Could economic woe be a blessing in disguise for the climate and the environment as a whole? Not quite, according to Scientific American:

…global economic downturns take a toll on the environment by restraining economic activity that could improve the situation. But that’s not all. Over-farming and drought led to 400,000 square kilometers of prime top soil blowing away in the wind in the 1930s, exacerbating, and exacerbated by, the Great Depression. And the economic crises that crippled the economies of southeast Asia in the 1990s also set in motion a rapid up-tick in environmentally damaging pursuits such as illegal logging and cyanide fishing, according to the World Bank.

The article goes on to point out that Europe may have to pull back on its commitments to reduce carbon emissions because of the current credit crunch. It will be a while before we can clearly see all the implications of this crisis for energy investment and climate action, but if T. Boone Pickens (as highlighted in the article) is bailing on wind power, it might be rough sailing for a while. I’ll throw this out to the Common Tragedies community: is the impending global recession going to be a boon or a bust for energy and climate?

Posted in Energy, Uncategorized | 1 Comment »

More subsidies

Posted by Daniel Hall on November 13, 2008

The World Energy Outlook 2008 is just out, with updated estimates of energy subsidies:

According to our calculations, energy-related consumption subsidies, which encourage consumption by pricing energy below market levels, amounted in 20 non-OECD countries (accounting for over 80% of total non-OECD primary energy demand) to about $310 billion in 2007.  Oil products account for one-half, or $150 billion.

The WEO also states that the IEA plans to publish a special report on energy subsidies in 2009.

I’ve placed graphs of energy subsidies in non-OECD countries below the fold:

Read the rest of this entry »

Posted in Energy, International | Leave a Comment »

A subsidy by any other name…

Posted by Daniel Hall on November 10, 2008

A couple of posts in recent months on energy subsidies, and particularly subsidies to fossil fuels in non-OECD countries, have drawn immediate responses implying that energy subsidies in the U.S. are quite large themselves, particularly indirect subsidies through the military to maintain international oil production.

I am skeptical that this comparison is relevant, or fair.  A few points:

1. The IEA estimated in 2006 that subsidies to fossil fuels in non-OECD countries were $220-280 billion per year.  This represented the net economic value of subsidies — essentially, the amount by which local fuel prices were lower than a competitive market price (i.e., an international oil price combined with some calculation of local refining and delivery costs).  These are net direct subsidies; they make fuel prices lower and encourage (over)consumption.

2. In the U.S. the EIA recently estimated that current energy subsidies are around $16.6 billion on gross, with about half of this going to renewables (particularly biofuels), nuclear power, conservation, and energy R&D.  Fossil fuels get around $5 billion, and this is gross, not net.  Note that the Highway Trust Fund, which is filled mostly from America’s small 18.4-cent per gallon gas tax, collected almost $39 billion in 2007.  The simple truth is that on a per-unit basis energy is neither much subsidized nor taxed in the U.S.*  In most other OECD countries meanwhile, fossil fuels — particularly transport fuels — are taxed on net.

3. What about indirect subsidies?  You can certainly find estimates that imply total U.S. energy subsidies are north of $100 billion a year, but I haven’t seen any estimates that look rigorous or convincing.  This study put out by (or linked from) EarthTrack looks at least somewhat more respectable; it finds that total U.S. subsidies are $37-63 billion per year.  But notice that much of this is of an indirect nature — more than a third comes from the estimates of defending Persion Gulf oil shipments — and it is unclear who these indirect subsidies are supporting.  Securing the Gulf arguably subsidizes the world oil market — U.S. consumers may benefit, but so do all other world consumers.  Further, what percentage of our military expenses should be counted as an energy subsidy?  We have many strategic objectives beyond energy policy when we deploy forces in the Middle East (or elsewhere).

4. What about indirect subsidies in non-OECD countries?  China has made no attempts to hide its policy of securing access to energy supplies for its national firms.  Much of this is being done in a naked quid pro quo way in Africa, with aid such as infrastructure development tied directly to energy access.  Are we going to count these costs?  And don’t forget that China is also dealing with — and turning a blind eye to the actions of — some unsavory regimes in Africa.

In the end I think the basic story you should have in your head goes essentially like, “Fossil energy is subsidized in most of the non-OECD, is not much taxed or subsidized in the U.S., and is taxed on net in most of the rest of the OECD.”  Yes, there are complications and you can do lots of spinning of sophomoric midnight theories while sitting with your friends over cigarettes and coffee, but you are going to need to offer me some hard evidence and persuasive arguments to get me to change my basic tune.

*As a result the U.S. price for transport fuels is frequently used as the international metric for a competitive market price.  See Figure 3 in this report for a nice graphic comparing gasoline and diesel prices in the U.S. to many of the large non-OECD countries.

Posted in Energy, International | 2 Comments »

Race to the bottom

Posted by Daniel Hall on September 9, 2008

Foreign Policy recently roasted the 10 worst ideas proposed by Barack Obama and John McCain.  Both candidates get burned on energy policy: 4 of the 10 worst ideas from each candidate fall under energy or climate change policy.

I agree with most of what they have to say.  Obama’s support for ethanol and coal-to-liquids technologies is indefensible.  Windfall profit taxes on oil companies are a bad idea.  As for McCain, the less said about the gas tax holiday the better.  Cap-and-trade without auctioned permits = corporate pork.  And I’ve explained before why I’m skeptical about the prospects for nuclear power having a large impact in our energy and climate change policies.

I would quibble with one (energy policy) item on each list.  I think there are reasonable arguments for opening the SPR much more liberally than we do currently — as Obama proposes — in order to smooth out market volatility or reduce price spikes.  (These arguments would mirror those for suspending SPR fill when prices are very high.)  As for McCain’s desire to “drill, baby, drill!”, I’ve already noted that there may be a very strong case for more domestic drilling.  (As Matt Kotchen cunningly phrased the conundrum recently, “What would environmentalists do with ANWR?”)

But the overall feeling you get from each list is the depressing sense that as energy prices have risen to the top of the headlines this year, the candidates have raced to out-dumb each other on energy policy.

Posted in Energy, Government Policy | 6 Comments »

Energy subsidies

Posted by Daniel Hall on July 28, 2008

There is a good article in today’s New York Times that discusses fuel subsidies, particularly in Asia:

From Mexico to India to China, governments fearful of inflation and street protests are heavily subsidizing energy prices, particularly for diesel fuel. But the subsidies — estimated at $40 billion this year in China alone — are also removing much of the incentive to conserve fuel. …

China raised gasoline and diesel prices on June 21, though still keeping them below world levels. World oil prices plunged more than $4 a barrel within minutes on the expectation that Chinese demand would slow.

In Indonesia, the government spends six times as much on energy subsidies as it does on agricultural investments, even as rice prices have skyrocketed this year.

Many countries, like India, have raised oil prices considerably in recent months, only to watch world prices climb even further, pushing up the cost of subsidies once again. China’s estimated $40 billion in subsidies this year is up from $22 billion last year, mainly for this reason, although consumption has also risen, with Chinese buying 18 percent more cars in the first half of this year than in the period a year earlier.

A few comments:

1. It is reasonable to wonder how long many of these countries can afford these policies if oil prices stay around current levels.  (“Before adjusting the prices, Malaysia was spending 7.5 percent of its entire economic output on fuel subsidies, a greater share than any other nation. Indonesia follows with 4 percent.”)

2. The $40 billion figure for China is eye-popping, but it is not entirely clear what fuels it is for and how it was calculated.  The IEA has estimated that in 2005 China subsidized oil products to the tune of around $7 billion, out of $25 billion in total energy subsidies.  My understanding is that the 2008 World Energy Outlook is going to take another look at developing country energy subsidies.  I wait with curiosity.

3. As Free Exchange notes, a lot of the increase in oil consumption in China is being driven by increases in wealth and consumption more broadly.  Market prices won’t stop demand in China from growing but they might help prevent China from developing into an oil-addicted behemoth (see America, 1950s).

4. The EIA estimates that the U.S. currently subsidizes energy at around $16.6 billion, with about half of this going to renewables (particularly biofuels), nuclear power, conservation, and energy R&D.  About $2 billion goes to oil and natural gas, almost all in the form of tax expenditures.  On a per-unit basis energy is neither much subsidized nor taxed in the U.S.

Posted in Energy, Gasoline, Government Policy, International, Oil | 2 Comments »

A Price Signal May Not Be Enough to Promote Energy Efficiency

Posted by Erica Myers on March 7, 2008

As energy prices increase, consumers will reduce their demand through energy efficiency measures and behavioral changes, which in turn will lead to fewer GHG emissions, right? Not according to the latest Carbon Market News Release form Reuters. Despite a recent spike in domestic gas and electricity prices, demand for energy has barely moved. In fact, the more that 100% increase in oil prices in recent years may actually be leading to an increase in carbon emissions.

” ‘The paradox here is that what looks like an increase in energy prices is in fact feeding through to an increase in carbon emissions rather than a reduction,’ said Oxford University economist and government adviser Dieter Helm.

‘That is because the oil price is not a genuine carbon tax. Far from cutting demand for carbon, the high energy prices have prompted a rush for coal — the dirtiest fuel,’ he told Reuters.

While known reserves of oil are expected to last only to around mid-century, and gas is in relatively plentiful but still finite supply, coal reserves are estimated to last for several centuries more.

There are big increases in coal burn in China, India and the United States where even tar sands have started to look attractive to investors again.”

Why isn’t a price signal enough to kick start investment in energy efficiency, “the low hanging fruit”? Rich did call me out on CT almost two months ago to put in my two cents on this; better late than never. Here are a few thoughts-most of these issues work in tandem:

1. The incentives for energy savings are not always there

– The person making the capital investment decisions is not always the person benefiting from energy savings (principle-agent problem). For example, the owner/manager of a building may not be the one paying the utility bills.

– The benefits from energy efficiency often come from relatively small diffuse pieces, and private businesses are more likely to invest in one large deal.

– People can’t respond to prices because they don’t have real time pricing information

2. The costs of achieving energy efficiency are likely higher than some estimates suggest (they are sometimes reported as negative costs)

– Lack of substitutability/Hidden Costs- Rich’s example of the difference in the quality of light emitted from incandescent vs. CFL light bulbs (though they do come in soft white now)

– Transaction costs of raising awareness or implementing programs such as putting smart grid technology in everyone’s house.

3. How people actually behave does not always match theory

– With advances in behavioral economics, we are recognizing things such as the “status quo bias” where there seems to be some added cost to switching behavior. The investment that it takes to review the options to make a different decision may seem confusing and not worth it for uncertain benefits.

– Rich suggested (in the same post as above) that people may be using higher discount rates than those in many energy models. For example, if people deal with expenses on a monthly basis, a large upfront cost may seem more expensive than the meager per month savings felt over time. This could be the case even if the cost savings exceed the initial capital investment at market discount rate.

“Evidence shows that there are few visible behavioural changes as a result of high prices. Governments need to do more than just rely on the price mechanism,” said Jim Watson of the Sussex Energy Group. “You need demand side measures too.”

Getting these demand side measures right means getting the incentives right, and matching them to actual human behavior.


Posted in Efficiency, Electricity, Energy | 4 Comments »

Pool and spa safety makes it into the energy bill

Posted by Rich Sweeney on December 17, 2007

However renewable portfolio standards and increased oil taxes didn’t. You can find the most recent version of the Orwellian named “Energy Independence and Security Act of 2007” here. Provisions aimed at defraying the costs of safe swimming begin on page 812.

Posted in Energy, Government Policy | 1 Comment »

The New EIA Energy Outlook is here!

Posted by Rich Sweeney on December 12, 2007

The Energy Information Administration just released its 2008 Annual Energy Outlook. This is like the Bible of domestic energy consumption, and provides the base case that almost all policies are compared against. Initial highlights include more renewables and more nuclear. Here’s the press release, and the early release of the report itself. Enjoy.

Posted in Electricity, Energy | Leave a Comment »