Wednesday, February 10 , 2016, 12:13 am | Fair 50º

Tam Hunt: How Obama Should Tackle Climate Change, Energy Independence in Second Term

By Tam Hunt |

President Barack Obama has already provided climate change and energy issues a prominent place in his second term rhetoric, giving climate change and the environment the most space of all issues in his inaugural address. He also vowed in December to make climate change and energy one of his top three priorities in his second term.

But we’ve been here before. It’s a little known fact — already lost in the sands of time for most people — that Obama’s first State of the Union speech stated: “It begins with energy.” Energy was in fact the most prominent issue in many of his talks and other communications for the first part of his second term. That is, until it became clear that dramatically lower energy prices, from the crash of 2008 until the middle of 2009, had weakened public support for tackling the sources of record high energy prices, and for tackling climate change issues in a struggling economy.

Energy and climate change issues slowly slid away from Obama rhetorically, even while he enacted some fairly far-reaching reforms in his first term that will do much to mitigate climate change and enhance energy independence. A few of Obama’s signature achievements on these issues in his first term:

» New fuel economy (Corporate Average Fuel Economy, or CAFE) standards, requiring that cars and light trucks achieve a 54 miles per gallon standard by 2025. There are some loopholes, to be sure, that bring this down to about 36-42 mpg, but this is still a major, and highly cost-effective, measure for reducing oil consumption in the United States. The Energy Information Administration calculates that this change alone will reduce our oil consumption by 4 billion barrels from 2017 to 2025, about 60 percent of our current annual consumption — and, of course, far more after 2025 as gains continue.

» Tax credits and loan guarantees for renewable energy and energy efficiency. Despite the Solyndra debacle, and the political opportunism that accompanied it, the fact is that the loan guarantee program that Solyndra used has performed better than expected when Congress created it. Congress allocated up to 10 percent of the loans to failed companies or projects and as of now the actual failure rate is less than 5 percent of all funds awarded. More generally, the tax credits and other incentives provided by the 2009 ARRA “stimulus package” were a major boon for renewable energy and energy efficiency and have helped to achieve record years for solar and wind power in the last few years even while the economy more generally has been struggling.

» Proposed new rules for regulating greenhouse gases from new power plants. Ironicallly, this new rule, proposed in April 2012 and receiving a huge amount of criticism from coal supporters, will, according to the Environmental Protection Agency’s economic analysis, do literally nothing in terms of preventing new coal power plants from being built. This is the case because EPA projects that existing market forces (primarily much lower natural gas prices) will already prevent any new coal plants from being built through 2030. So why enact the rule? Well, it establishes definitely the EPA’s legal right to explicitly regulate greenhouse gases for the first time. And market forces may change, so it does make some sense to enact this new rule.

What about Obama’s second act? How should he proceed on his recent promises to do something real about the threat of climate change? We are approaching $100 a barrel again for oil. 2012 was officially the most expensive year ever for gasoline in the country, as well as the hottest year on record for the contiguous United States. It is highly likely, with the U.S. and global economies recovering, that oil and gasoline prices will shoot far higher by the summer. The time is now for Obama to take substantial actions on these very important issues.

Here are my recommendations, discussed further below:

» Reconsider opposition to a national carbon tax

» Phase in regulation of greenhouse gases from existing power plants

» Enact a national Renewable Electricity Standard (RES)

» Require states to implement existing law (PURPA) that allows private developers to sell renewable energy to utilities at cost-effective rates

» Require all federal agencies to reach 50 percent electric vehicles in their fleet by 2020, if this can be done cost-effectively

A National Carbon Tax

Economists of all stripes agree that a modest carbon tax (say, 10-15 cents/gallon of gasoline) would be a highly effective way to reduce emissions. Sen. Bernie Sanders, I-Vt., recently proposed a carbon fee proposal in the Senate. The New York Times’ Tom Friedman recently proposed that a carbon tax could be a highly effective “two-fer” — it could both reduce emissions and revenue could be used to offset the national deficit, an eminently sensible proposition. I’ve argued previously that the national focus on cap and trade is misplaced and a well-designed carbon tax would be much better.

Unfortunately, the White House has recently expressed opposition to a carbon tax. Let’s hope that changes.

Phase In Regulation of Greenhouse Gases from Existing Power Plants

Obama’s EPA hasn’t officially announced its intent to regulate GHGs from existing power plants — but it is legally obligated to eventually do so under the clear language of the Clean Air Act. This will surely be the mother of all regulatory battles if and when it does happen. It seems that any regulation of existing facilities will have to be phased in slowly, and that’s probably for the best since it may entail significant economic dislocation. In a struggling economy (and in any economy, for that matter), we’ve got to be sensitive to job issues as well as environmental and broader economic issues.

The modest carbon tax discussed above could, and probably should, include existing power plants, and it could be introduced at a very modest level and slowly increased over time. This doesn’t seem to be on the EPA’s or Congress’ radar at this time, but public pressure can always help to change minds.

A National RES

I am not a big fan of coercive government measures. I’d prefer that markets did their job and provided for the common good in an appropriate time frame. But climate change is a classic example of how markets can fail to incorporate externalities — in this case the harm to our environment and to us from increased greenhouse gas emissions, or the risk of oil price spikes — and it is for this reason that I do support strong national and state measures when it comes to climate change and energy.

A national Renewable Energy Standard (RES) could provide a floor for states to achieve a certain level of renewable energy by a certain date. California and more than half of other states already have an RES in place, but many of the dirtiest polluting states don’t have an RES. An RES doesn’t say “achieve higher renewables at any cost.” Rather, every RES I’ve examined has a cost-effectiveness requirement or an economic safety valve of some sort. A national RES would surely include a cost-effectiveness requirement. And the good news is that many renewables are now cost-effective and are becoming increasingly cheaper over time.

Modify PURPA

PURPA, the Public Utility Regulatory Act, was passed by Congress in 1978 under President Jimmy Carter’s direction. It was the first law that allowed private energy developers to sell power to utilities for a set fee — a type of “feed-in tariff.” PURPA was implemented in different ways by each state, with varying success. In California, PURPA was responsible for an “embarrassment of riches” in terms of new wind, biomass and solar projects, made competitive by the record high oil and gas prices during the 1980s. The majority of our renewables in California are still PURPA projects, though this is changing fast.

Unfortunately, PURPA was largely gutted in recent years and it’s faded as an effective tool for promoting renewables for a variety of reasons. It’s time for Congress to modify PURPA again and to require states to implement PURPA in a way that is effective in promoting renewables. In other words, it’s time for a real national “feed-in tariff” (also described in recent years as CLEAN programs, or Clean Energy Accessible Now). 

RES and feed-in tariff policies are complementary in that an RES sets the goal and a feed-in tariff is a tool for reaching the goal.

Require Federal Agencies to Reach 50% Electric Vehicles by 2020

On the transportation side of the energy equation, we face a much more difficult challenge. The electricity sector is already undergoing impressive transformation — just not fast enough, and that’s why I recommend the above measures. The transportation sector is a much tougher nut to crack because there are few truly viable alternatives to oil today. Electric vehicles, along with price-induced conservation (which will continue to happen naturally) and more efficient vehicles, present the best solutions for the transportation sector.

We’ve seen an impressive first two years of EV sales in the United States and abroad — but it’s just a prelude to much bigger things. To accelerate this transition to EVs becoming mainstream, Obama should require that all federal agency fleets have 50 percent EVs by 2020. This would be a major spur to the market in the next few years and would help get the EV market to scale, allowing all consumers to realize significant savings in terms of lower EV costs.

It will be a tough slog to mitigate climate change and energy price issues in the coming years, but the recommendations above will be a good start.

— Tam Hunt is a Santa Barbara lawyer and writer, and blogs at Thought, Spirit, Politik. Click here to read previous columns. The opinions expressed are his own.

» on 01.27.13 @ 07:27 PM

Oh and Tam , one more thing- shut down Keystone XL.  It is a huge scam with multiple layers of environmental consequences.
Persuing tar sand energy sources , not even for our own domestic use , is the last thing we should be doing right now. Thanks a lot drill baby drillers.

» on 01.28.13 @ 12:30 AM

Wally, I haven’t examined the Keystone project in any detail but from what I know it seems that if Obama’s agencies decided to not grant permits for the Keystone project that the Canadians will find some other way to develop the tar sands. China and India’s thirst for oil is only growing, and current projections have them sucking up all available global oil exports by the late 2020s, so the economic pressure to develop the tar sands is likely to be inexorable. So I don’t think the Keystone pipeline, pro or con, is going to have much long term impact on climate change, and it will, on the flip side, help provide an additional source of oil to the US.

» on 01.28.13 @ 01:50 AM

This article fails to mention the single most momentous change to energy policy in our generation: fracking. Because of this technology, energy prices (natural gas) are far lower than the rest of the world; we are amazingly getting closer to energy independence in the next 5 years; and companies are now considering building plants in the US rather than overseas to take advantage of the low energy prices. The impact of fracking on the economy is comparable to the advent of the internet in the 1990’s. It could revolutionize our energy industry and return our economy to the days where manufacturing jobs were primarily in the US. It could boost economic growth to a level not seen for many years in the US.

Renewable energy sources, while laudable, are still a tiny part of the total energy consumption in the US, and the taxpayer dollars spent on it by the federal govt in the last 4 years cannot be rationally justified by any objective analysis, unless you are personally financially benefiting from it (Tam) or you are a close-minded political ideologue.

» on 01.28.13 @ 03:05 AM

Lou, the fracking revolution is over-hyped, in my view. The revolution thus far has boosted natural gas production in the US by about 25%, which is nothing to sneeze at, but hardly deserving of being called a revolution. Also, EIA projects that by 2016 natural gas prices will surpass coal again (in the last year they’ve often been lower than coal prices, which has indeed been a game changer in terms of eliminating the economic case for new coal power plants), mooting your point about the impact of increased natural gas production on our economy and manufacturing. Coal prices have also been going up in recent years, but natural gas prices are heading back up now and, based on EIA’s modeling of declining production from conventional fields, will continue to rise in coming years. My next piece on energy issues will look at oil and gas fracking in more detail.

As for renewables, we’re now at about 12% of our electricity from renewables and the majority of new capacity in 2012 was renewable, so the transformation of our power system is under way. Solar is particularly promising, especially if we can maintain anything like the 100% annual growth rates we’ve seen in the last two years. This is the real revolution, driven by precipitously lower prices and an industry that is now at scale globally (producing enough new panels per year to power about 5 million CA homes).

» on 01.28.13 @ 03:20 AM

And of course, Lou, natural gas is a polluting fossil fuel, with higher emissions from fracking than conventional production. Moreover, a number of reports have found, when including the impact of “fugitive emissions” (that is, methane escaping without being burned) in the analysis natural gas greenhouse gas emissions can rival that of coal. So if we take climate change concerns seriously we don’t want to be looking to natural gas as any kind of panacea.

» on 01.28.13 @ 03:22 AM

I have pasted a link from an article written by Fareed Zakaria (an Obama supporter) in Time. Here is an example of what he thinks:

“Over the past decade, America has experienced a technological revolution—not, as expected, in renewable energy but rather in the extraction of oil and gas. As a result, domestic supplies of new sources of energy—shale gas, oil from shale, tight sands and the deepwater, natural-gas liquids—are booming. The impact is larger than anyone expected.”,9171,2127202-1,00.html

» on 01.28.13 @ 03:44 AM

Neill Ferguson, a Harvard historian and author, has said that fracking could bring about an economic renaissance in the US. Here are a few quotes from this CNN article:

“U.S. energy production has been booming in recent years. The International Energy Agency made a jaw-dropping forecast two weeks ago that the U.S. would pass Saudi Arabia as the world’s biggest oil producer by the end of this decade—and would achieve near energy independence by the 2030s.”

“This is an absolutely huge phenomenon with massive implications for the U.S. economy, and I think most people are still a little bit slow to appreciate just how big this is”

“It’s not only in the extraction industry and infrastructure, but more importantly cheap energy is going to create employment in manufacturing. I think you’ll see a renaissance in manufacturing”

This is not an isolated opinion. Many economists in the US (including our Energy Dept) agree with these statements.

» on 01.28.13 @ 03:54 AM

Here is a headline from a recent US News and World Report article:

“An Energy Lifeline: Fracking a Game-Changer for U.S. Economy”

» on 01.28.13 @ 04:08 AM

Last article I am going to quote on the fracking revolution (CBS Money Watch), although there are tons more.

“U.S. oil output is surging so fast that the U.S. could soon overtake Saudi Arabia as the world’s biggest producer.

Driven by high prices and new drilling methods, U.S. production of crude and other liquid hydrocarbons is on track to rise 7 percent this year to an average of 10.9 million barrels per day. This will be the fourth straight year of crude increases and the biggest single-year gain since 1951.

The boom has surprised even the experts.

Five years ago, if I or anyone had predicted today’s production growth, people would have thought we were crazy,” says Jim Burkhard, head of oil markets research at IHS CERA, an energy consulting firm.”

» on 01.28.13 @ 12:57 PM

Lou, believe I’m aware of the stories you’re posting. Again, my next article will be a detailed examination of these trends - and my explanation of why I think forecasts of US energy independence are very exaggerated.

Also, you’re now conflating oil and gas. My statements here were about natural gas b/c that was what you were discussing as a game changer for US industry. Again, NG prices are about even again now with coal, and coal has been cheap for a long time (though prices have increased steadily over the last decade) so there is no game changer in terms of cheap electricity for US industry.

US oil production has certainly taken a surprising turn upwards (from about 5 million barrels per day to almost 7 at the end of 2012) but it seems very likely that this is a temporary phenomenon. The decline rates for new fields in the tight oil fields like Bakken and Eagle Ford are really high - 40% per year or more - which means that you have to drill more and more wells to even maintain level production, let alone increase production. This is the classic red queen effect and it’s the focus of my next article.

» on 01.28.13 @ 05:28 PM

Mr. Hunt’s a lot more informed about this stuff than I am.

Way too often, though, high-toned speech rhetoric about one emergency or another never survives from a swearing in, or State of the Union, into real action.

One early tip-off will be what kinds of people he picks to run his main “enviro”
agencies, how broadly he empowers them to innovate, or take bold steps, and
how publicly he personally defends them when his Flat Earth Society opponents
in Congress start to go after them.

A way simpler way for nudging Obama toward a more sustainable energy future
for America is simply to remind him that when his own daughters kids are the
same age, the world Obama and the Party of NO! may bequeath them might be
an increasingly dangerous, disease-ridden, less livable waste-land, and he may
one day have to look his family in the eye, and explain to them Why.

» on 01.28.13 @ 07:10 PM

Tam, anything that makes energy expensive is bad. An economy as indebted as ours cannot afford higher energy costs, period, unless you want to see our living standard rolled back. It’s that simple. The more you pay for energy the less you have for research, development, food, travel, hiking in the back country, writing books, pontificating on global warming or if you are already poor, food, heating, clothing and shelter.

To damned often we hear energy policy discussed from those whose ivory tower existences can afford to absorb the added costs of their lofty elitist goals. Never once do they consider those who are already being squeezed at the bottom end and so the roll back in living standards continues. Those standards for the poor peaked in this country at the height of our energy production and have been falling ever since. I hear many complaints from the left at the demise of the middle class and how it is related to the demise of collective bargaining. The truth is we have gouged the middle class with ever higher energy costs and let’s not forget what precipitated the mortgage melt down, the gas price spike in 2008.

Unfortunately, since I don’t glom onto the carbon fuel hysteria I am often confused with supporting fossil fuel development. Wrong. What I promote is cheap energy and I don’t give a rat’s ass where it comes from. But I know one thing it ain’t coming from wind mills and fairy dust people. And just saying no to carbon fuel because you are too stupid to understand climate dynamics doesn’t make cheap energy either.

I do believe you give a crap Tam and admire your persistence, but until I see you promoting lower costs rather than anti carbon, you’re just another zealot trying to make a buck off of Publius’ fear.

» on 01.28.13 @ 07:58 PM

I disagree that adding a carbon tax to the use of fossil fuels will lower the use of fuel. If adding 15-20 cents to a gallon would achieve a lower use of fossil fuels, the higher fuel prices we’ve seen in the last decade would have resulted in lowered use of fuel. It did not. Rather, the costs are passed onto consumers if possible or absorbed by the business, as in the case of thousands of truckers out of work because they could not absorb the higher fuel prices and couldn’t pass it on either. Or they hung in and now make 5 bucks an hour. Higher food costs do not result in people dieting, only more expensive food.

And the idea that this carbon tax money would go towards anything other than lining government busybody bureaucrats pockets, or those of their political donors, is ludicrous. Look at what’s happened to the state fuel tax funds that are supposed to go towards road infrastructure, as well as the national part of those taxes.

What will lower the use of fossil fuels is not a Prius or carbon taxes, but alternate methods of energy use and transportation. And, we are the worlds most proliferate consumers burning up way more than our share. Perhaps a change in lifestyle is in order. Another gov program will only muck up the works, again.

» on 01.28.13 @ 08:03 PM

AN50, we’ll have to agree to disagree on this one. As we’ve discussed too many times in past go-rounds, cost is always a factor in my arguments and in policymaking when it comes to climate change and energy more generally. The proposed EPA rule for GHGs from new power plants, as with all EPA regulations, must included an economic analysis. EPA’s analysis finds zero costs of this new rule b/c, as I mentioned above, EPA projects zero new coal plants being built due to existing market forces. More generally, energy efficiency and conservation are inherently cost-effective. And as I’ve mentioned many times also, even if there is a short-term cost to some alternatives, such as solar power (which is often cost-effective already but not always), we’ll all save in the mid- to long-term because of the inexorable increase in fossil fuel costs. Natural gas prices are going back up, and as I mention above gasoline prices are at record highs again, and even at an all-time high for the US and Europe. Last, too often, and you included, commentators ignore the costs of externalities such as air pollution or greenhouse gases. There is a cost to polluting our environment, but historically it’s not been included. We are now starting to include these costs as a normal part of doing business and as this improves alternatives to fossil fuels will rightly become increasingly cost-effective. To sum up: the path I’ve recommended here will almost certainly save us all bucket loads of money in the mid to long-term (meaning 5 years out and beyond).

» on 01.28.13 @ 08:15 PM

Mikey, higher gasoline prices have had a profound impact on US consumption - we’re down now to where we were in the mid-1990s. Here’s my detailed article discussing what’s described as “elasticity” in consumption when it comes to gasoline consumption:

» on 01.29.13 @ 02:23 AM

Good grief.  Will you enviro-marxists ever learn?  Green on the outside, red on the inside.  Everything has to be a top down, government mandated scheme to force us mere plebes to comply with their brilliant and totally uneconomic ideas.  If they are such great ideas and great technologies they could survive on their own without forcing them down our throats.

Tam tries to sound reasonable but its the same old same old.  Renewables, carbon taxes, CAFE standards, climate change, blah, blah, blah.  I can’t believe he’s still touting these green energy investments in the stimulus.  They’ve been a disaster, many of them are already bankrupt.  What a sick joke.  The Chinese are losing money in solar. 

CAFE standards are a proven killer due to lighter cars are the only feasible way to meet the standards.  The new standards Obama mandated are absurd, there is no way to meet them without a ton of electric cars.  Electric cars that nobody wants to buy.  Even if they did, in CA that would require us to build many, many new power plants to charge those cars.  Plants that will burn natural gas or coal because you won’t let us build carbon free nuclear plants. 

We all know Tam is personally economically incentivized to see “renewables” succeed.  He just wants the rest of us to subsidize his gains in unnecessarily higher electric bills.  Crony capitalism 101 with green eyeshades.  CA already has much higher electricity costs than our neighbors, which is driving manufacturing to other locales.  I guess that hasn’t occurred to our lefty geniuses in government.

Climate change?  I thought it was man-made global warming?  Gee, once the wheels came off that shaky bus they had to rebrand it to something more innocuous that they can blame any abhorrent weather on.

I’ve got an idea.  How about you lefties leave us alone for awhile?  Your killing us.

» on 01.29.13 @ 05:33 AM

Wireless, good to hear from you again.

» on 01.29.13 @ 05:41 AM

It is extremely ironic that oil and natural gas production has surged in the US because of fracking and may save our economy from the disastrous policies of the Obama Administration, even though this President has done absolutely nothing to encourage it and may attempt to have the EPA kill it. Considering all the harm this President has inflicted upon the economy, it is the only bright spot in an otherwise bleak economic landscape.

» on 01.29.13 @ 02:23 PM

Wireless, responding to the substance of your comments and ignoring the silliiness:

- in terms of markets doing their jobs, I suppose this would extend to the mortgage markets, savings and loan markets, banks, etc., all of which have clearly not functioned as intended? The fact is that markets only work well in the long-term with smart regulation. Energy markets too. I agree intervention should it be minimized as much as possible, but there are over-arching concerns that I mention above that weigh against a laissez faire approach in energy markets

- more generally, the model I support is in fact all about decentralized power, literally. I focus on community-scale renewables and allowing private parties to produce and sell their own power. The markets in the US have historically favored the monopoly utility model and my recommendations about PURPA and feed-in tariffs are designed entirely to democratize and decentralize power production. So just as I support maximum decentralization of political power (see my piece Something New Under the Sun) as a general matter, so I support decentralization of energy/power. Decentralization makes us all more resilient and protects against abuses, while also creating local jobs and other ancillary benefits.

- You need to research CAFE standards. The auto industry supported Obama’s new standards, after much wrangling, and the 36-42 mpg actual requirements (as opposed to the 54 mpg headliner) are eminently achievable, and in a highly cost-effective manner

- it’s just wrong to state that CA will need a bunch of new natural gas or coal power plants to power electric vehicles. This statement displays a deep ignorance on these issues that you’re weighing in on. Studies have found that our existing power grid could get us to a pretty high penetration of EVs because we have a large surplus of night-time and day-time power. More generally, renewables can power EVs as well or better than fossil fuel generation. Solar panels on homes and business are a perfect complement to EVs. How cool would it be to have a perfectly self-sufficient personal energy economy in which solar panels provided all of your electricity and much if not all of your transportation energy too? This is now possible and cost-effective thanks to dramatic price declines for solar power and affordable EVs like the Volt and Leaf.

» on 01.29.13 @ 02:36 PM

Tam, do you own a Volt or Leaf?

» on 01.29.13 @ 02:43 PM

I own a Prius C, the greenest vehicle on the market at this time, according to ACEEE. However, when the clean grid benefits of electric vehicles are considered for markets like CA, they come out greener. I wish I’d gotten into a Volt now but they weren’t offering the amazing deals on the Volt that are available now.

» on 01.29.13 @ 04:12 PM


What is silly?  Let’s hear your profound un-silly response.  As far as I’m concerned your constant drumbeat of this continually discredited nonsense is silly.

As a typical misinformed liberal, you don’t seem to understand what occurred in the mortgage market that caused the meltdown in the first place.  It was government rules and encouragement to lend money to people that had no plausible way to pay it back.  Banks would have never made those loans in the first place were it not for dumb government rules pushing and threatening them to do so.  Banks would have never made those loans if Fannie and Freddie, at Congress’ insistence, hadn’t created a massive secondary market to dump those lousy loans on someone else.  Nobody would have bought these lousy mortgage packages on the secondary market if they didn’t come with AAA ratings from the ratings agencies blessed by the government and the correct assumption the federal government would back the debt of GSE’s.  And finally, the whole mortgage mess never would have happened if the Federal Reserve, another agency charted by Congress, hadn’t thrown gasoline on the fire with way too easy money.  Oh yeah, and the SEC federal regulators who had all the authority and tools needed to stop some of the really egregious madness were too busy watching porn on their computers. 

I really don’t understand why you libs have so much faith in government to have all of this competence to do all this stuff when they have an absolutely abysmal record on just about everything they try to manage.  They caused the housing meltdown and stood by with their heads up their butt as it happened.  Medicare, SS, Medicaid all going bankrupt and bankrupting our country.  They did such a great job managing these programs, lets give the federal government even more control over our healthcare with Obamacare which is already predictably exploding our healthcare costs.  Brilliant.  Now you tell us to trust them to figure out what technologies we need to throw more tax money at that we are borrowing to lead us to a bright green energy future?

But, back on topic.  We’ve been round and round on this over the years.  You act like you don’t want all this government interference in one breath; in the next you say Obama should mandate mandatory use of EV’s because not enough people are buying them.  You contradict yourself constantly and you don’t even realize it.  You tell us, despite Solyndra, that all these green energy investments were really great.  Hmmm.  We poured over $1B into battery companies to power these wonderful electric cars and they all went bankrupt.  That doesn’t count what we poured into electric car companies themselves.

Electric cars, doubling down on dumb:

California’s clown car mandate:

There was a study done, that I can’t seem to locate at the moment, by two researchers at I believe Berkeley, that calculated that if everyone in CA drove electric cars it would require about 250 new power plants in CA to provide enough power to charge them all.  I’ll keep looking for it and will post if I find it but I didn’t make it up.

Has it ever occurred to you that maybe all this politically motivated “investment” is, shall we be kind and say “inefficient”?

Regarding CAFÉ standards, perhaps you need to educate yourself:

They are also economically destructive.  The Center for Automotive Research says that 264K jobs could be lost by these absurd CAFÉ standards due to the hugely increased costs of vehicles meaning fewer will be sold:

All these dreaded right wing websites!  I’m sure you’ll have a problem with it but it is what it is.  You can’t insert these uneconomic mandates into the economy without significant economic consequences. 

If you want to spend your money on EVs and solar panels knock yourself out, just stop trying to use the government to force the rest of us to pay for your green dreams.

BTW, here is a nice little article in that right wing rag in Germany known as Der Spiegal that talks about the costs of Germany’s green dreams:,1518,718951,00.html

Like I said, how about all you do gooders give us a little break.

» on 01.29.13 @ 04:41 PM

I wouldn’t buy it now. The Volt seems like a hassle, You have to plug it in for 15 hours to get around 35 miles of driving and then the 9 gallon tank gives you another 325 miles. You have to spend in excess of $40,000 for a small underpowered car, although you get a $7,500 credit from the govt (on the taxpayer’s dime). GM is practically giving away the car with ridiculous incentives and bargain basement lease terms because no one wants the car. Without the govt subsidies, no one would buy the car.

» on 01.29.13 @ 05:25 PM

Tam all things cost. Any thing you do in energy that delivers less at a higher cost means someone has to pay

Every thing you are proposing adds to the cost of energy we as consumers must pay. My biggest problem with your line of thinking is that it ignores the consequence to the bottom half of the socio economic ladder. This callus disregard of the poor and middle class is morally repugnant to me.

Yes I realize that in the paranoia induced craze of the climate change religion starving nasty earth destroying humans is a worthy goal. You are trying to SAVE the planet! What difference does it make if the stupid masses of poor and middle classes have to die off or live like animals? If we destroy the planet with our very breath we’ll all die anyway!

I believe the current politicization of climate science by zealots, calling GHG’s “pollution” is a form of misanthropic insanity. Everything you propose is driven by this insanity. I made it clear many times before, if your motivation is not more energy cheaper then it’s less at a higher costs and that is anti human. We are not animals and we are not some cancerous disease that needs to be eradicated. Change the underlying motivation for your energy analysis and watch what happens. The transformation is rather astounding and the number of viable new energy paradigms increases geometrically.

» on 01.29.13 @ 05:51 PM

AN50, this is the last time I’m going to respond to you on the cost issue b/c you simply don’t get what I demonstrate every time we have this discussion. Moreover, I feel that your alleged concern about the poor is a case of crocodile tears. Nowhere in your comments over the years, except in response my arguments for renewables do you express any concern for the poor. And as I’ve stated in the past, the clean energy future I’ve advocated for a while now is very likely the best hope for the poor in the coming decades. Solar power is transforming remote villages in Africa and providing emergency power in disaster areas around the world. And as fossil fuel prices continue to rise the trend toward renewables will only become more important.

Again, if you accept peak oil - as you have stated you do - then it is clear that fossil fuel costs of all types are going up, and up and up. This means that everything we do to reduce fossil fuel use is a cost saver in the long run.

And alternatives can also in many cases be cheaper than today’s equivalent power from fossil sources. Energy efficiency, conservation, more fuel efficient cars, wind power, hydro power, and geothermal power all fall into the category of “cost savers” now. Solar power can also be cost-effective now in many situations and will be cost-effective across the board in just a few years based on current price trends (solar prices have come down about 60% in the last three years alone).

Ergo: your repeated claim, with no evidence, that my solutions are more costly is simply wrong in most cases.

A carbon tax would, by definition, cost us all a bit more, granted. But there are ways to return these funds to low income earners as a “dividend” and this is generally part of carbon tax proposals around the world. And/or we could, as I write above, use much of the carbon tax revenue to reduce our deficit. And we’d all benefit from that. So by placing a modest tax on socially and environmentally harmful behavior (burning fossil fuels) we can achieve many societal benefits.

A recent peer-reviewed study found that powering a large grid (like CA’s) with 90-99% renewable electricity by 2030 could be done at the same cost we pay today.

» on 01.29.13 @ 09:31 PM

Peak Oil?  Still on that bandwagon, huh.  There is tons of stuff out there if you bother to look somewhere other than green blogs.

We were already supposed to past peak oil and now we have way more proven reserves than we had when the whole peak oil theory was postulated.

» on 01.29.13 @ 10:07 PM

Let’s deal with carbon taxes.  Another boneheaded big government solution to a non-problem.  Perhaps you aren’t aware but Europe’s carbon tax hasn’t exactly helped their competitiveness or their budget deficits or their economies.  In fact, it has hurt all three and accomplished nothing.  Certainly nothing commensurate with the costs.  The whole cost-benefit thing seems to escape lefties.  Especially the enviro-marxist types.

But I digress.

So what has happened here in CA since our own idiotic carbon scheme was put in place in 2006 and just now really sinking its teeth into businesses (AB-32).  In case you haven’t noticed the CA economy is lagging and we continue to see business leave the state.  We’ve gone from the largest net new company creator to the last place, we are losing companies.  Its not a coincidence.  These renewable energy mandates come with a huge cost: 32 IG Econ Analysis Backgrounder 9-28.pdf

AB-32 is the ultimate self-inflicted wound, it is simply driving businesses out of this state, hurting our economy and raising our costs while accomplishing next to nothing.

Carbon taxes lead to malinvestment into costly green boondoggles.  Europe is killing themselves for no reason:

Unless everyone in the whole world signs on to the same system, which they won’t, you simply disadvantage yourself by driving up the cost of energy.  Higher energy costs increases the costs of producing any good or service as it is a fundamental input.  If you have higher energy costs than your competitors its hard to compete.  We can see that already here in CA.

Take your head out of the green Kool-Aide

» on 01.30.13 @ 10:32 AM

“Concern for the poor”?!?  Good grief, more support for the concept that conceit is cause for longwinded argument devoid of wit or common sense.

» on 01.30.13 @ 01:00 PM

Tam, I stand corrected, not all of your ideas are more costly and certainly we both agree that distributed solar PV and geothermal can be true cost savers. I am actually a big supporter of industrial solar PV mainly because the higher cost of production is offset by the lack of need for added distribution. Geothermal stands to gain handsomely from the technology boom in the oil drilling and fracking business. The gains being made in drilling technology will translate to a boom in geothermal and that will have an enormous impact on the electric grid.

My goal is to see electrical production costs drop dramatically as enormous new capacities are added. This will allow us to transition the wasteful practice of burning transportation fuel in stationary generating plants. Think of the possibilities when that occurs. Look at what cheap hydro did for aluminum production. Apply that model to CO2 sequestration and now you can turn trillions of cubic meters of NG and sequestered CO2 into liquid high density transportation fuel with no net CO2 added to the atmosphere. All on the back of abundant cheap electricity supplied by geothermal. Your efficiency happens when you apply Solar PV at the end user for conservation.

This can happen Tam. It would benefit the poor more than any other socio economic group. It just takes changing from an anti carbon anti human motivation to one where we actually mimic the natural carbon cycle life depends on, the major difference being we substitute lower rate solar radiation for much faster energy conversion rates with geothermal. This is what I am trying to get you greenies to realize. Environmentalism does not have to be some misanthropic antagonistic tool of the Marxists. As an industry consultant on energy and manufacturing efficiency I help companies save their bottom lines all day long and the biggest benefactor is the environment. Do more, get more and make more using less.

» on 02.05.13 @ 12:06 AM

Here is a good article on fracking in Der Spiegal.  Our salvation if we can keep the eco-marxists like Tam from shutting it down:

» on 02.05.13 @ 01:46 AM

Wireless, there is no question that fracking can be game-changer if the wacko radical environmentalists don’t manage to kill it.

The industry is awaiting a comprehensive study and proposed regulations for fracking from the EPA. Lisa Jackson, the head of the EPA, who has said some positive things about fracking although she is basically hostile to the oil and gas industry, just resigned. Congress is investigating her using an alias email account (named after her dog) to communicate with other high level executives at EPA. The agency has refused to release the emails for the past year, but a recently appointed inspector general is forcing the agency to release all the emails. Interestingly, she resigned (probably not a coincidence) just before this massive dump of emails from an secret email account.

Her successor will now have responsibility for promulgating fracking regulations. The future of the industry, and literally the future health of the economy and the energy industry in the US, will be dependent on who Obama will select. Hopefully, this Administration understands the importance of getting this right because the consequences cannot be overstated.

» on 02.05.13 @ 02:41 AM


If you are hoping Lisa Jackson’s replacement is going to be any less of a radical than she was you’re probably dreaming.  In fact, based on Obama’s other nominations since his unfortunate reelection I suspect he/she will be even worse.

All you need to know is one thing:  Carbon is evil. 

This is their mindset and they will do anything in their power to put up roadblocks to impede carbon based fuels expansion.  They believe the man-made global warming nonsense and nothing, I repeat nothing, will dissuade them from that belief. 

Don’t be shocked if they try to find some way to shut down fracking.  They can’t help themselves.

» on 02.05.13 @ 12:47 PM

I fear you are right Wireless. It’s all about anti carbon, not what makes the most sense. Carbon, the most essential element in our biosphere, the basis of organic chemistry, is now evil. Good grief, if they can make carbon evil they can do the same with the most prolific and greatest green house gas, water vapor. Can you imagine what would happen if these same anti carbon zealots actually made water a pollutant?

As I explained to Tam there are many various energy paradigms available for us to exploit and if we try to mimic nature instead of control her we just might win. Anyway for me fracking is the gateway to a future rich in abundant cheap geothermal. The technology being developed to extract hydrocarbons is unbelievable and will be a game changer. But if the anti carbon zealots get their way it will ruin a huge opportunity for mankind to liberate himself from the restrictions we suffer from our limited solar radiation quotient (which drives wind, solar and bio fuel supplies).

The petroleum based industrial civilization we have built over the last century was the first step in that liberation, but trapped hydrocarbons are limited. We must have a new paradigm based on an energy source that is far greater than the high density mined carbon supplies and far denser than other alternatives. Our planet’s core heated by radioactive decay and gravitational kinetics offers the most abundant supply of thermal energy we could ever hope for. Getting it is a technological milestone and fracking and hydrocarbon extraction are the stepping stones for getting there.

The only road block is the irrational fear of AGW. Remove that and the future is wide open.

» on 02.06.13 @ 01:42 AM

Unfortunately, I am right.  Just look at their actions, they speak for themselves.  There is zero reason to shut down the Keystone pipeline and there is no real evidence that fracking is a danger.  It doesn’t matter.  Gaia does. 

We have options up the wazoo if these radicals would stop abusing the court system and political system to shut down our access to affordable energy.  Instead, they want to keep shoveling borrowed money from our children to the latest green fad be it switch grass, solar, wind or Tam’s latest love child:  electric cars; regardless of the economics or viability. 

Just look at nuclear.  It is the most carbon free of anything, very safe and the most reliable and the most scalable, yet they find excuse after excuse after excuse to oppose it and drive up the cost of implementing it through regulatory and legal abuse.  We could cut our carbon emissions by a massive amount if we went mostly nuke on electricity.  If they really cared about carbon and were rational, they would be embracing nukes but yet they resist it more than coal.

What people need to understand is the radical environmentalists are a bunch of control freaks first and foremost.  Like I said green on the outside red on the inside.  Carbon and man-made global warming have become religion for the godless.  It’s a cause.  It’s faith based.  Don’t confuse them with the facts.  It’s all about control of people’s lives, their behavior and most of all, their money.  That is why they love this cap and trade scam.

They will lose in the end, the economics don’t work and ultimately you can’t escape economics.

» on 02.06.13 @ 02:49 AM

AN50, glad to see we can agree on some things, in particular energy efficiency and geothermal. I’ve stated previously that I’m a strong supporter of geothermal and it provides about 6% of CA’s electricity today. But it’s not ready for prime-time in many parts of the state or country b/c it’s too expensive unless the heat source is fairly close to the surface. You’re right that oil drilling techniques will likely help improve the cost-effectiveness of enhanced (deeper) geothermal and this is an irony I can accept without supporting more oil drilling.

As for solar, it is well on its way to becoming the go-to power source for all needs. Chinese solar panel production costs are now projected to come in at about 42 c/Watt, down from 59 c/Watt in 2012, which itself is down (literally) 85% over the last four years.

This is world-changing. We are fast coming to the point that the all-in cost of solar (panels plus balance of system plus labor plus permitting) is the most cost-effective and reliable solution available.

Solar will of course need other sources to provided power when the sun isn’t shining but solar is in fact a reliable peak power resource because solar production peaks when power demand peaks (generally). Batteries or other types of storage will become increasingly more important as solar penetration increases in the coming years. Natural gas will certainly continue to play a part for many years to come but we are well on our way in CA to a post-carbon electricity grid. And this will be done cost-effectively.

As for the future of oil, here’s my latest (soon to appear on Noozhawk also):

» on 02.06.13 @ 03:07 PM

Tam, I am going to insist that you disclose that you own a business where you financially benefit from hawking solar. If I don’t see this disclosure in your next article, I will contact Bill. It is fundamentally dishonest of you to write these articles constantly hyping solar without disclosing your financial interest. To say that you’re a lawyer and writer and not a “solar broker” (your term) is totally unethical.

Readers will be able to more accurately judge if your opinions in this area are not influenced by financial self-enrichment.

» on 02.06.13 @ 03:11 PM

Lou, Bill knows what my day job is, as do most of my readers. Crikey, the linked sponsor takes you right to my website!  I’ve written frequently about my day job in my columns. I have the luxury of “doing well by doing good” in that I’ve followed my passion and made a living doing it. My writings are a natural extension of this passion. Also, I’m not a journalist - I’m a columnist. All of my pieces are opinion pieces. That said, I’ll noodle whether a disclaimer is warranted.

» on 02.06.13 @ 03:55 PM

You use these columns to market your services to your clients. You refer to them on your website. I am not sure why you are resisting a simple disclosure that you have a financial interest in the solar industry. Your readers can evaluate your commentary much better if they understand this background history. You don’t believe in transparency?

» on 02.06.13 @ 11:26 PM

Here is an interesting blog post about the political battle in CA over fracking.  Walter Russell Meade:

» on 02.07.13 @ 12:27 AM

What you have is a well-entrenched solar and renewable energy industry getting rich from the panoply of very generous govt subsidies (taxpayer dollars), and will fight any attempt to bring fracking to Ca because it will in all likelihood threaten their livelihood. This is why I am insisting that Tam disclose that he has a financial interest in the solar business, which benefits from the incredible govt. subsidies offered to his industry.

Isn’t it interesting that he identifies himself as a writer and lawyer, two professions which are hardly relevant to the issues he writes about - but his daytime job as a “solar broker”, which is totally relevant to his ardent defense of anything related to the renewable energy industry and strident opposition to anything fossil-related, goes unmentioned.

» on 02.07.13 @ 01:14 AM


As I pointed out in an earlier post, it is quite tiresome how Tam continuously touts this nonsense acting as an objective “writer” when he has a financial interest in the government mandated gravy train continuing to waste money we don’t have.

The green resistance in general though is the religious anti-carbon crusade.  Make no mistake about it.  Tam just has figured out how to profit from the scam.

» on 02.07.13 @ 02:21 AM

You are probably right about the “religious anti-carbon crusade”.

I presented articles from US News & World Report, Time, CNN, and CBS News (hardly right-wing publications) about the incredible impact of the extraction of shale gas and oil on the economy and the amazing revelation by almost all the pundits in the energy industry that we are on track to overtake Saudi Arabia as the world’s leading oil and gas producer. So how does Tam respond: It’s all a hoax. Where are all the articles in these publications about the booming renewable energy industry and its revolutionary impact on the economy? That’s right - there are none.

» on 02.07.13 @ 03:35 AM

Tam is proving himself to be phony.  Note how he didn’t seem to be able to respond to all of the various articles i posted regarding peak oil, CAFE standards and the like.

» on 02.12.13 @ 04:58 PM

Hey Tam,

Care to comments on this piece:

Obama’s Electric Car Mistake:

» on 02.16.13 @ 08:52 PM


Right on que, here is another mini-expose on the follies of electrical cars and renewables mandates:

» on 02.16.13 @ 11:14 PM

Until Tam buys an electric car and forswears fossil-fueled cars, he needs to keep quiet because right now he has his greedy hands in my pocket taking my tax subsidized dollars to enrich himself.

» on 03.11.13 @ 11:42 PM

Here is yet another detailed analysis of what a joke electric cars are.

» on 03.12.13 @ 02:08 AM

I haven’t read the article Lomborg cites re energy required to produce EVs, but I’ve seen analyses similar to his, arguing that lifecycle GHGs from EVs aren’t that good b/c the grid is dirty. These arguments miss two key points: 1) most EVs sold today are in states with relatively clean energy; 2) all grids are getting much cleaner over time. And if we get much more efficient in producing batteries, as we surely will, then the other key point Lomborg makes is weakened considerably.

I do agree with Lomborg that EVs and plug-in hybrids won’t be a significant part of the solution for the next decade or so b/c the vehicle fleet turns over only every 11-15 years, making change pretty slow. However, we will be getting to scale pretty quickly at the sales rates for today’s EVs and we’re already seeing some significant cost reductions. As EV sales pick up in the next few years we have a good chance, though by no means certainty, of seeing EVs become de rigeur in the vehicle market.

» on 03.12.13 @ 02:53 AM

“As EV sales pick up in the next few years we have a good chance, though by no means certainty, of seeing EVs become de rigeur in the vehicle market.”

Next few years? Want to make a friendly bet?

» on 03.12.13 @ 02:55 AM


I’ll give you credit for stick-to-itiveness.  You are a true believer.

Whether electric cars are made in low carbon states or not doesn’t really address the key point.  As Milton Friedman pointed out decades ago, there are no free lunches.  You net out the same one way or another.  It takes the same amount of energy to roll a rock up a hill whether it is with an electric car or a diesel and that is essentially what this article is pointing out without saying so directly.  There aren’t any shortcuts mankind has found to shortchange that reality.

I’ve made the case many times with you that electric cars are going to be powered by carbon producing sources be it coal or gas.  Especially since you eco-radicals refuse to allow the ultimate carbon free power source: nuclear.  But I digress.

The problem with electric cars is the same basic problem with solar.  Fighting Physics.  For solar to become more efficient the materials need to become more efficient as the photons per unit area falling on the earth is essentially constant.  In order for the efficiency to improve that requires basic material engineering to improve the bandgap of electrons in the material.  Non-trivial.  Is it a solvable problem?  Maybe.  Looking at human history, probably.  But it will very likely take many years and many, many billions of dollars of investment.  In the meantime, it is not really a competitive energy source for general use.

Batteries have the same issue.  It’s not easily solvable.  The periodic table is what it is.  The energy density of hydrocarbons is hard to beat.  That’s life.

You and your pals on the left have tried to make carbon based and nuclear energy more expensive to compensate for these manifest issues with “green” energy.  It is a game for losers.

Stop fighting the tide and trying to convince us to accept what won’t work on an economic basis.  Keep advocating for it but you are damaging your cause by pushing stuff that isn’t ready for prime time.

Free advice for what its worth.

» on 03.12.13 @ 02:21 PM

Wireless, wager what? That EVs are a substantial part of US sales by 2030? Sure. As I wrote, I think the uptick in EV sales in the next few years will get us to scale in terms of production, such that EV sales will be a substantial part (as in, let’s say, over 30%) of US car sales by 2030. We saw 2012 sales double 2011 sales in the US and similar rates worldwide, but this will surely slow somewhat. I don’t know the magic number at which battery production costs start to drop significantly, like we’ve seen for solar in the last few years (dropping about 80% in cost in just five years), but I imagine it’s on the order of a few million EVs sold each year, which could happen in a few years if we see current trends continue.

» on 03.12.13 @ 02:29 PM

Oops, last post should have been directed at Lou, not Wireless.

Here’s my response to Wireless:

You’re simply wrong that “it nets out the same way” no matter what technology we use. This is a key point of switching to electric drive technologies: they’re 2-3 times more efficient than internal combustion engines. So there’s a potential for literally tripling the efficiency of energy use in transportation by switching to electric drive. This is largely why driving EVs is so much cheaper than ICE: the cost of electricity is relatively cheap and it’s far more efficient to use electricity to move stuff than to use gasoline.

That said, the key of course is to get the cost of the cars down to the point where they’re ubiquitous.

You’re also completely wrong about EVs necessarily being powered by coal or gas. CA, for example, has a grid that is almost half not coal or gas, and every state in the country is moving in this direction, as is the world as a whole.

EVs are ready for prime-time - and sales figures are showing this. As with solar power, what’s needed now is not necessarily new technologies (though I fully support new technologies and R&D) but SCALE. By getting to scale, EVs and PHEVs will dramatically reduce costs for these technologies as, again, we’ve seen with solar in the last few years.

Here’s a nice chart showing the dramatically declining cost of solar, such that it’s about to cross over with coal power! The headline of this graphic is incredibly wrongheaded, however, as it should be touting this incredible development (solar about to become cheaper than coal) rather than the fact that some renewables are still expensive.

» on 03.12.13 @ 03:23 PM


As is usually the case you miss the point.  I suggest you read the article again.  The point he is making is that building an electric car requires twice as much carbon generation than a normal car and that is in fact less green due the mining of lithium for the batteries, which is fairly rare.  So the car has to be driven a lot in order to make up that initial carbon deficit from manufacture.  When most of them only go a few miles relatively they are of limited utility and are unlikely to be driven enough to make up the initial carbon hole.  This is why I made the point you end up in the same spot from a total carbon budget. 

His other point is that the electricity is likely generated by carbon sources, coal and gas.  While electric motors are indeed very efficient there are losses in the transmission of electricity that are non-trivial.  If everyone drove electric cars we would need huge amounts of new electric generation capacity that will need to be gas or coal as well.  Your favorites of wind and solar are too intermittent (and expensive) to handle the needed capacity and most people would charge the cars at night when the sun isn’t shining.  You greens won’t allow us to build any new capacity without a huge fight.

I talked to a guy locally who bought a Tesla.  Cool looking car and he loved it but he also said his electric bill has gone through the roof charging the thing.  It pushed him into the top tier billing.  There are no free lunches.

If these things are so great why don’t you buy one yourself?  Pay full price too, without the government bribe to buy it.  Face it, these are vanity toys for rich libs.

» on 03.12.13 @ 03:36 PM

Wireless, it is in fact you who have missed the point. I rebutted the points you raise in your last post in my first post. Again: 1) even without reading the report Lomborg refers to we can state with confidence that energy and costs for producing EVs will decline substantially as they get to scale (this happens with every technology); 2) where EVs are sold today the grids are far cleaner than the national average (West Coast and NE), undermining his assertions about the average US grid composition; 3) all grids are getting far cleaner over time. Ergo: Lomborg’s conclusions are simply wrong b/c he doesn’t consider where EVs are actually bought today or how things are changing over time at all. And, news flash, things are changing, and rapidly.

So, no, it doesn’t net out the same whether we use ICE or EVs. It’s a huge difference in efficiency and GHG reductions, in actual practice, particularly as we consider how things are changing over time.

I haven’t bought a Tesla yet b/c I can’t afford one. I’d love to get one and perhaps I will (fingers crossed) in the next year or two. I haven’t opted for a Leaf b/c it’s range is too limited for a one-car household (me). I drive a Prius C, the greenest car on the market right now according to a new ACEEE report. However, a Tesla or a Leaf is in fact greener in places like CA b/c our grid is relatively clean.

» on 03.12.13 @ 04:03 PM

very lame Tam.  But you make my point about them being toys for rich libs as they are only sold on the West Coast and the Northeast. 

I thought you said everyone should own one?  Including all those conservative neanderthals that get their electricity from coal?  So in order to make your case you have to only use these white elephants on “clean” grids.  Please.  The article stands, your prevaricating is pretty weak.

The cost of making them is largely driven by the batteries, those aren’t going to get a lot cheaper anytime soon.  In fact, if demand explodes they will get more expensive as lithium is very rare and difficult to mine.  The motor also use a lot of copper, also very expensive and getting more so.  The key raw materials for the car are getting more expensive, not less.  The rest of the car is using stuff largely available in conventional cars so you will gain no production efficiencies from that content.  So your assertion that less carbon will be required in manufacture holds no water at all, on what basis?  The materials production is what generates the carbon.

Here’s a little info on lithium mining:

You’ll note the industry believes the spot price will rise.  Here is a copper chart:

This is why copper theft has become so prevalent of late.  Good business.

» on 03.18.13 @ 06:23 PM

Wireless, it’s not that EVs aren’t sold in markets other than West Coast and NE, it’s that sales are far higher in these areas than others, and, again, these grids are far cleaner than Midwest and South.

But even in areas that traditionally have relied on coal there has been a remarkable shift toward natural gas in the last few years. Coal used to supply over 50% of electricity in the US, and natural gas about 20%. Now they’re about even at about 35% each b/c natural gas has been so cheap and b/c of the ongoing effort to regulate coal’s air pollution (both traditional pollutants and climate pollution). This isn’t necessarily a good thing, however, from a climate perspective b/c a number of recent studies have found that when we count fugitive emissions from natural gas mining (escaped methane) the greenhouse gases from natural gas consumption may be as much or even more than coal.

Re batteries, they are already becoming cheaper and are projected to become much cheaper. A recent report from McKinsey found that batteries are likely to more than drop in half in cost by 2020 and by about 2/3 by 2025. Of course, if EV sales are faster than McKinsey assumes in their projections then battery costs will likely fall even faster.

You’re right that certain battery components have gone up in price recently, but the battery cost trend is downwards. With solar, there was a bottleneck in silicon supplies for a few years that led prices to rise from about 2004 to 2008, but since then the prices have dropped remarkably, due to dramatically increased supply from Chinese, European, Japanese and American firms. It’s reasonable to assume that the same thing will happen with batteries b/c this is how markets work more generally: limited supply lead to higher prices and then to increased market attention and then more supply and lower prices.

I don’t think we’re yet firmly on the exponential growth curve for EVs, as we clearly are with solar, but we’re probably just a few years away from being on that curve.

» on 03.18.13 @ 07:42 PM

“this is how markets work more generally: limited supply
lead to higher prices and then to increased market attention and then more supply and lower prices:  Tam Hunt

I am surprised that Tam is a believer of the law of supply and demand, a central tenet of capitalism. However, he forgot to cite the corollary: higher prices equals less demand. So far this has controlled the alternative energy markets despite the voluminous subsidies provided by our govt.

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