Friday, June 21, 2013

Comment on a very hairy Dutchman

Richard Tol is a very skeptical man, an economist and rather  blunt, though not as blunt as I am.  I am sure we would enjoy drinking schnapps together, or maybe just beer.

But he seems not to have a clue about the type of dispassionate writing required for academic journals. Or perhaps dispassion deserts him when he is discussing fraud.

I am referring to his rebuttal of "Mr 97%" John Cook (2013) a rebuttal which was recently rejected by ERL.  ERL would always have found some reason to reject Richard's paper but Richard made it easy for them.  His paper was blatantly political and was full of speculation (about "fatigue", for instance).  ERL was right to reject it.  I would have sent it back for revision, however, as there was a lot of solid data in it that stood by itself as an effective rebuttal of the Cooker.  In my days writing for the academic journals I got about 40 critique articles published on politically loaded topics so I think I am a reasonable judge of what is required there.

Anthony Watts has put the paper up so you can judge for yourself. I am rather cross with Richard for spoiling the presentation of his basically sound work.  I would encourage him to delete the problem passages I mentioned and resubmit to another journal. Just the first paragraph of his paper would have sufficed as an introduction, for instance.  If properly done, the journal editor should not be able to guess the opinions of the author.

And when you have put up some statistics showing that the other guy is a complete fool, you don't say: "This guy is a complete fool".  You say:  "These discrepancies may be some cause for concern".

UPDATE: I should perhaps have mentioned for the benefit of newcomers to this topic that there have been a lot of comprehensive demolitions of young Mr. Cook's work -- e.g. here -- but getting them into the academic literature is very uphill. No matter what the merits of the piece, journal editors will rarely publish what they do not want to publish.

Nettles not fully grasped in Britain

A speech to the House of Lords by Viscount Ridley

 My Lords, I begin by declaring an interest in coal-mining on my family’s property, as detailed in the register, but I shall not be arguing for coal today but for its most prominent rival, gas, in which I have no interest.

I thank my noble friend the Minister for her courtesy in discussing the Bill and welcome the fact that the Government have grasped the nettle of energy policy, especially on the issue of nuclear power, after the deplorable vacuum left by the previous Government. However, I am concerned that we are being asked in the Bill to spend £200 billion, mainly on the wrong technologies, and that we will come to regret that. We are being asked to put in place a system that will guarantee far into the future rich rewards for landowners and capitalists, while eventually doubling the price of electricity and asking people to replace gas with electric space heating. That can only drive more people into fuel poverty.

We have heard a lot about the needs of energy investors and producers. We have not heard enough about consumers. If the industry gets an 8% return on the £200 billion to be spent, just two offshore wind farms or one nuclear plant would be declaring profits similar to what British Gas declares today. That will be an uncomfortable position for the Government of the day.

The Bill is a dash for wood and wind —two medieval technologies —and it is twice as big as the dash for gas of the 1990s. Between 6 and 9 gigawatts will have to be built a year for the next 16 years, compared with 2 gigawatts a year during the dash for gas. I am not sure it can be done, let alone affordably. In the case of biomass, the only way we can source enough is by felling trees overseas. As the noble Lord, Lord Berkeley, said, Drax will soon be taking more than 40 trains a day of wood pellets from North America. That is not energy security.

Under the Bill, “‘low carbon electricity generation’ means electricity generation which in the opinion of the Secretary of State will contribute to a reduction in emissions of greenhouse gases”.

Shades of Humpty Dumpty: a word means just what I choose it to mean. We are being asked to pretend that the most carbon rich fuel of all, wood, is not a source of carbon. According to Princeton University, trees used for biomass electricity generation increase carbon dioxide emissions by 79% compared with coal over 20 years and by 49% over 40 years, even if you replant the forest. We are through the looking glass.

Offshore wind, meanwhile, is a risky technology with a track record of engineering problems, sky- high costs, disappointing lifespan and problems of decommissioning. At the moment, we generate less than 1% of total energy, or 6% of electricity, from wind, despite all the damage it has already done to our countryside and economy. We are to increase that to something like 30% in just a decade or so, may be more if nuclear is delayed. It is a huge gamble, and if it fails, the only fallback is carbon capture and storage, a technology that has repeatedly failed to meet its promises at all, let alone affordably, a point made earlier by the noble Baroness, Lady Liddell.

Even if this wood and wind dash is possible, under the contract for a different system proposed in this Bill, while better than the renewable obligations that preceded it, the subsidy to renewable energy will quadruple by 2020. That is only the start. On top of that, there are system costs for balancing the unpredictability of wind; transmission costs for getting wind from remote areas to where it is needed; VAT; the carbon floor price; not to mention the cost of subsiding renewable heat and renewable transport fuels. Hence, at a conservative estimate, the Renewable Energy Foundation thinks that we will be imposing costs of £16 billion a year on our hard-pressed economy for several decades.

Why are we doing this? We are doing this because of four assumptions that were valid in 2010 but, as my noble friend Lord Lawson pointed out, are no longer valid to the same extent. First, we assumed we would not be acting alone, so we would not damage our competitiveness. Instead, not only is there no longer a Kyoto treaty, but China is planning to build 363 coal- fired power stations; India 455. On top of that, the European trading system has collapsed to less than €5 a tonne of carbon. Our carbon floor price is more than three times that: £16 a tonne, rising to £32 a tonne in 2020 and £76 a tonne in 2030. Acting unilaterally in this way does not save carbon emissions. It merely exports them and the jobs go with them. Northumberland’s largest employer, the aluminium smelter at Lynemouth, has closed with the loss of 500 jobs, almost entirely because of carbon policies.

The second assumption behind the Bill was that the cost of gas would rise, thus making the cost of energy rise anyway. The Committee on Climate Change said recently in a report that:

“Consensus projections are that gas prices will rise in future”.

This remark has been described by the utilities team at Liberum Capital as “genuinely amazing” in the light of recent events. Now that we know that gas prices have plummeted in the United States to roughly one-quarter of ours, thanks to shale gas; now that we know that Britain probably has many decades worth of shale gas itself; now that we know that enormous reserves of offshore gas near Israel, Brazil and parts of Africa are going to come on line in years to come; now that we know that conventional gas producers such as Russia and Qatar are facing increasing competition from unconventional and offshore gas; now that we know that methane hydrates on the ocean floor are more abundant than all other fossil fuels put together and that the Japanese are planning to explore them; in short, now that we know we are nowhere near peak gas, it is surely folly to hold our economy hostage to an assumption that gas prices must rise.

We will need the gas anyway. The intermittent nature of wind means that we will require increasing back-up and we cannot get it from nuclear because it is not responsive enough to fill the lulls when the wind drops. Far from replacing fossil fuels, a dash for wood and wind means a dash for gas too, only this time we will have to subsidise it because the plants will stand idle for most of the time and pay a rising carbon floor price when they do operate. Having distorted the markets to disastrous effect with subsidies to renewables, we are now being asked, under the capacity market mechanism, to introduce compensating countersubsidies to fossil fuels.

The third assumption was that the cost of renewables would fall rapidly as we rolled them out. This has proved untrue and, indeed, as the Oxford Institute of Energy Studies has shown, the cost curve for renewables inevitably rises as the best sites are used up, not least in the North Sea. I am told by those who work in the offshore wind industry that, at the moment, the industry has every incentive to keep its costs up not down, as it sets out to strike a contract with the Government. They will not have to try very hard. Even at low estimates, offshore wind is stratospherically expensive.

The fourth assumption on which this Bill is based was that the climate would change dangerously and soon. Once again, this assumption is looking much shakier than it did five years ago. The slow rate at which the temperature has been changing over the past 50 years and the best evidence from the top-of-the-atmosphere radiation about climate sensitivity are both very clearly pointing to carbon dioxide having its full greenhouse effect but without significant net positive feedback of the kind on which all the alarm is based. The noble Baroness, Lady Worthington, and the noble Lord, Lord Stern, both mentioned Professor Myles Allen and they will be aware, therefore, of his recent paper, which found significantly reduced climate sensitivity. If that is the case, the dash to wind and biomass may well continue to do more harm to the environment as well as to the economy for many decades than climate change itself will do.

However, leaving that on one side, as my noble friend Lord Lawson said, the argument against subsidising wind and biomass does not depend on a benign view of climate change. It stands powerfully on its own merits, even if you think dangerous climate change is imminent. In 1981, my noble friend Lord Lawson, ignoring the prevailing wisdom of the day, as he sometimes does, decided against the predict-and-provide central planning philosophy and instead embraced the idea of letting the market discover the best way to provide electricity. The result was the cheapest and most flexible energy sector of any western country.

We have progressively turned our backs on that. Under this Bill, the location, the technology and the price of each power source is determined by one person—the omniscient Secretary of State. Recent occupants of that position have an unhappy history of not making wise decisions. Remember ground source heat pumps? They do not work as advertised. Remember electric vehicles? They have been a flop. Remember biofuels? They have caused rainforest destruction and hunger. Remember the Green Deal? Must we go on making these mistakes?

We have returned to a philosophy of picking winners, or rather, from the point of view of the consumer, of picking losers. Not even just picking losers, but hobbling winners, because of the obstacles we have put in the way of shale gas. America has cut its carbon emissions by far more than we have, almost entirely because of shale gas displacing coal. By pursuing a strategy that encouraged unabated gas, we could halve emissions and cut bills at the same time. Instead, I very much fear we will find we have spent a fortune to achieve neither.


UK electricity prices almost twice as expensive as Germany within three years

Electricity prices in Britain may be almost double those in Germany within three years due largely to the impact of a new tax aimed at supporting renewable power generation, a report by bank Credit Suisse has claimed.

The bank's analysis showed wholesale prices, which form the backbone of energy bills, would top those in Germany by 85pc in 2016-17 and would be higher in general for the next seven to 10 years.

The bank blamed the roughly fivefold rise in the government's new tax on carbon-dioxide emitting power generation over the next seven years, while also pointing to Britain's lack of infrastructure to import power from the European mainland.

Prices in the two countries had tracked one another for years, but they diverged last year as Germany spurred a boom in renewable energy generation by pouring billions into subsidising the green sector.

The Credit-Suisse figures show that in the winter of 2016/17 UK power prices will trade at an 85pc premium to German equivalents, compared with a 25pc divergence currently.

"Our analysis suggests these differentials will continue for the next seven to 10 years," analysts at the Swiss bank said in a report to clients.

The Government introduced the mandatory tax on carbon emissions at £4.94 per tonne of CO2 earlier this year, adding to the carbon charges already in place under the European Union's Emissions Trading System (EU ETS).

The two costs calculated together will rise to £30 per tonne in 2020, an expense which will significantly increase British power prices, Reuters reported.

German power prices have fallen on the back of the boom in solar and wind power but the government has now moved to rein in subsidies in recognition that the expansion may have come too fast given concerns over profitability and problems with managing the flow of green energy.

Seeking to learn from that, the UK model is to cap the value of subsidies annually in the hope that taxing carbon heavily will encourage the market to invest more in the renewable sector.

But Credit Suisse said the net effect over the next decade would be to cap the growth of renewable capacity.

The lack of substantial interconnection capacity with other countries also means that the UK will not benefit from the effect of low prices on the mainland, they added.

Higher wholesale power prices in the UK have led to much better stock market performance by UK utilities compared with those in mainland Europe over the past 18 months.

Share prices in UK power utilities have increased around 28pc over the period, while European stocks are down 8pc.

SSE is the Credit Suisse's top pick for shares to buy due its diverse range of generation fuels and its business exposure in Britain as well as Ireland.


More GM crops means more nature reserves, says British minister

A big expansion of genetically-modified crops in Britain could lead to the creation of more nature reserves

The Environment secretary will say on Thursday that using GM will make use of farm land and “free up space for biodiversity, nature and wilderness”.

In a speech to make the moral case for GM foods, Mr Paterson will stress how “the farmer benefits, the consumer benefits, the environment benefits” from GM crops.

Officials briefed that if current GM food restrictions were lifted it would also mean that the price of some foods will come down in the shops.

Mr Paterson is battling to persuade officials in the European Union to lift current rules which only allow one type of maize to be grown in the UK.

Britain is pushing for scores of GM crops to be given the green light by EU regulators, including herbicide tolerant maize and sugar beet.

The Environment Secretary’s speech comes after Prime Minister David Cameron said last weekend that Britain should take a new look at GM food as part of efforts to make the UK a pro-science country.

In his speech, Mr Paterson will link increased use of GM crops with freeing up more land for nature reserves. This is because GM crops have a better yield and so means that a smaller area of land would need to be planted.

He will say: “Used properly GM promises effective ways to protect or increase crop yields. It can also combat the damaging effects of unpredictable weather and disease on crops.

“It has the potential to reduce fertiliser and chemical use, improve the efficiency of agricultural production and reduce post-harvest losses.

“If we use cultivated land more efficiently, we could free up space for biodiversity, nature and wilderness.”

He will refer to research from Rockefeller University which suggests that more extensive use of GM crops “combined with improved agricultural practices across the world, could release an area 2.5 times the size of France from cultivation”.

He will say GM crops are “safe and cost effective” adding: “Farmers wouldn’t grow these crops if they didn’t benefit from doing so.

“Governments wouldn’t licence these technologies if they didn’t recognise the economic, environmental and public benefits.

“Consumers wouldn’t buy these products if they didn’t think they were safe and cost effective.”

He will add: “While the rest of the world is ploughing ahead and reaping the benefits of new technologies, Europe risks being left behind.

“We cannot afford to let that happen. The use of GM could be as transformative as the original agricultural revolution was. The UK should be at the forefront of that now, as it was then.”

Mr Paterson’s expected comments were welcomed by the GM industry. Professor Maurice Moloney, Chief Executive of Rothamsted Research, said: “We are very happy to see clear leadership on this issue from Secretary of State Paterson.

“GM crops and the use of biotechnology in agriculture has been effectively on hold in Europe for many years.

“The Government's initiative puts the UK back into a leadership position in Europe on this issue and will promote a rational approach to the adoption of technologies that our farmers want and need in order to maintain their competitive position in world agriculture.”

But critics were sceptical about Mr Paterson’s claims. Lord Melchett, Policy Director of the Soil Association, said there is no evidence any GM crops provide higher yields. He said that yields could even be lower, meaning more land is taken up.

Lord Melchett, who was arrested in 1999 when he was present at an environmental protest against a GM crop trial, also said it was worse for wildlife. He said the Government's own five year farmscale testing in 2004 had found that GM was worse for wildlife.

He said: “It is dinner party gossip he [Paterson] is coming out with not science and not policy.”

Pete Riley of GM Freeze said it would difficult to export GM crops to our main markets in the EU as consumers on the Continent are against the technology and the EC insist it is on the label.


From red peril to green panic

America’s military industrial complex once chased communists. Now it obsesses over CO2 emissions

For some years, America’s armed forces, intelligence apparatus and police have listened into and infiltrated environmentalist groups.   In 1997, in fact, FBI director Robert Mueller, who is still in post today, declared that environmental and animal rights agitators perpetrating criminal acts were among the agency’s ‘highest priorities’ in terms of dealing with domestic terrorism. Those priorities explain why, for instance, police in Nebraska collaborated, just last month, with TransCanada, the firm responsible for the proposed Canada-through-to the-Gulf-Coast Keystone XL pipeline. The joint mission? Profiling activist critics held likely to engage in the destruction of property and ‘monkeywrenching’ – throwing a spanner in TransCanada’s works.

So there’s long been lots of spying on Greens in America. Moreover, top leaders and experts in security matters have also long warned, in print, about the possibility of social unrest over environmental issues; and they have also long insisted on the need to control such unrest. Yet there’s a paradox here. Though the American state targets Greens, its geopolitical and strategic visions of the future reveal a conceptual framework that is deeply green. When the Pentagon and its allies draw up a forecast, what dominates the authors’ imagination are two old green bogeymen – disasters caused by climate change, and wars over scarce natural resources.

The nightmares are legion. Published in May 2010, President Barack Obama’s National Security Strategy contains no fewer than 23 references to climate change, and identifies it, along with pandemic disease and transnational crime, as a major threat to the global order. Or take the US National Intelligence Council’s December 2012 prospectus, Global Trends 2030: Alternative Worlds. Two of its four ‘megatrends’ for the next 17 years are about the world’s increasing population, its growing urbanisation, and the strains this will put on supplies of food, of water and of energy. Notably, the forecast suggests that, in a kind of feedback effect, climate change itself will ‘worsen the outlook’ for the availability of these three resources.

Of course, as in the past, such Mosaic roadmaps of the future do envisage wellsprings of upheaval that are economic, social, religious and patriotic, not just environmental. But in their growing obsession with environmentally based upsets to come, the US militarists have drawn closer than ever to Green thinking. The US state may wish to paralyse what the depleted remnants of the international left are pleased to term New Social Movements – ineffectual, anti-leadership outbursts that flaunt a modish antipathy to capitalism, globalisation, environmental damage and industrial sectors which can be termed Big. Equally, however, the US state shares the very same apocalyptic and Malthusian premises from which those ‘movements’ begin.

A one-eyed view of war in the twenty-first century

American securocrats have a naturalistic take on the world of the next few decades. For them the forces of nation or class, which motivated intelligence assessments throughout the twentieth century, are now jostled with by climate change and resource shortages. The spooks fear that, at home and abroad, global warming will increase the incidence and intensity of droughts, floods, hurricanes and perhaps, after 24 people died in minutes in the Oklahoma City suburb of Moore, of tornados as well. In this scenario, civil breakdown and unprecedented mass migration tomorrow justify the vigilance and mobilisation of armed force today – both outside and inside the US.

In May 2007, the US Congress commissioned a National Security Assessment of Climate Change. Nor was Congress unique in seeking counsel here: in the same month, an influential group of advisers to the German government submitted a 248-page report to it on Climate Change as a Security Risk. At the peak of the panic years of the noughties, such alarmist accounts of the likely impact of climate change were, perhaps, to be expected. Yet while anxiety about climate change in mainstream government and among the public has since ebbed away around the world, paranoia about climate in military circles has continued unabated.

In decades gone by, the US military shared some of the US environmentalism’s worries about America’s dependence on Middle Eastern oil, and its worries, too, about the vulnerability to terrorist attack of nationwide American energy grids (2). By 2009, too, it was already clear that the West would manipulate the issue of climate change to try to control the pace and direction of growth in the East (3). Yet now things have moved on again. Impressionism about climate’s effect on weather in the US seems to have combined with impressionism about the East’s demand for oil, minerals and other commodities to produce a new wave of panic at the Department of Defense.

In meditating relatively less on nuclear conflagration and more about an overheated planet that runs out of the basics, the US military, always charged with guarding against risk, has picked up all the sensibilities of environmentalism. Under a Democratic Party president, it could hardly be otherwise. Nevertheless, the armed wing of the state in the US still betrays a tremendously one-eyed view of war in the twenty-first century. Could wars of the future have anything to do, perhaps, with America’s willingness to meddle, on humanitarian grounds of course, in Iraq, Afghanistan and now Syria, the better to legitimise its domestic rule and insulate it from dissent? Might wars of the future also have something to do with the increasing arbitrariness in international relations nowadays, given that the resolute, unambiguous, goal-driven search for raw materials, markets and cheap labour no longer informs aggressive foreign policy postures in quite the way it did a century ago? About these causes of wars, we hear nothing from America’s far-sighted security prophets.

Their willingness to look the other way and instead focus on squabbles originating from the fate of the Earth’s ecosystems is all the more remarkable, given that environmental stresses are, if anything, not on the rise at the rates they were. After all, though the concentration of CO2 in the atmosphere has passed 400 parts per million (ppm), and world energy-related emissions of CO2 increased 1.4 per cent to a record high in 2012, there is good news: moving out of coal-fired power and into gas-fired electricity generation has helped cut US emissions, while the emissions increase in China, though a large amount, was one of the lowest in 10 years. Similarly, the pressure on resources has abated somewhat. Earlier this month, the US Energy Information Administration published bullish estimates of non-US reserves of shale oil and shale gas, suggesting that, respectively, they had added an extra 10 and 48 per cent to technically recoverable reserves of conventional fossil fuels. And, for a year or more, US politicians have barely been able to contain themselves about the unlikely prospect of America enjoying complete independence from external suppliers of oil and gas.

All of this is of little moment to the martial authorities in the US. One might observe that, just as turkeys don’t vote for Christmas, securocrats have no interest in playing down the military implications of environmental problems – any more than the CIA had an interest, just before the end of the Cold War, in predicting the fall of the Berlin Wall (4). But it would be more telling to observe that 10th-grade economics, in which a world of finitude is simply consumed by a growing and ever more greedy population, infects the US authorities as much as it does the world’s Greens.

Conclusion: agreeing with the Greens they crack down on

In all the rumpus about America’s National Security Agency (NSA), whingeing over invasions of individual privacy has tended to eclipse debate on the US state’s surveillance of larger, political organisations. In Britain, certainly, the willingness of the US tax authorities to harass members of the Tea Party, for example, has taken second place to the revelations of the NSA whistleblower Edward Snowden. But there can be no doubt that, as part of a wider culture of fear in Western society, the American state conducts plenty of electronic eavesdropping and human intelligence work on all kinds of radicals: not just on rather anarchist protesters like Occupy Wall Street, but also on green campaigners of every stripe.

Why, though, does the US state bother to do this covert and sometimes overt repression of its environmentalist critics? No doubt it exaggerates both the current and the putative influence of the more militant, ‘direct action’ end of American environmentalism just as much as it exaggerates the danger of Islamic terrorism on American soil. Yet if the peaceful language and street tactics of most of American’s environmentally-minded folk hardly inspires fear, that isn’t quite to the point. For the US state, as for very many environmentalists, narratives of the future forever revolve around a turbulent hell of shocking weather events and dog-eat-dog scraps over food, water, minerals and fossil fuels – and preparations must immediately be made for every possible consequence of that hell (5).

The only remaining question is why the US state represses environmentalists when it agrees so much with their ecological starting point. But that is just the issue: having lost a real opponent in the old Soviet Union, the US state now thrashes around trying to find new ones in Chechen losers (the Boston bombers), and also in environmentalists with whom it actually has a lot in common.

Bogged down in and trying to withdraw from Iraq and Afghanistan, America’s military could use some traction. From belligerent Bashir Assad in Damascus to limp opponents of fracking in the US, anyone can be drafted in to provide that traction. What lies before us with US spooks is not omniscience based on mass surveillance, but arbitrariness based on losing the plot and lacking a clear objective.


Government regs hurt passenger rail

Michael Barone

That’s the message of this paper from the Competitive Enterprise Institute. The writers point out the American safety regulators require passenger rail cars to be much heavier than European regulators do. But over the years, they say, the European cars have proved just as safe, and perhaps more so.

The problem is that Amtrak and other passenger rail authorities set out to provide higher speed service, they can’t buy rail cars commonly used in Europe. Cars must be custom designed–which has produced real problems, as those Amtrak encountered with the Acela. It also means that American rail cars can’t go as fast as European cars can. European models, they say, could get from Washington to New York in two hours and 15 minutes. The Acela takes half an hour longer.

I’ve been skeptical about most U.S. high-speed rail projects. But perhaps the changes in regulation the CEI authors advocate could make it feasible in more places. It sure would be nice if a day’s DC-NY round trip took four and a half hours rather than five and a half.




Preserving the graphics:  Graphics hotlinked to this site sometimes have only a short life and if I host graphics with blogspot, the graphics sometimes get shrunk down to illegibility.  From January 2011 on, therefore, I have posted a monthly copy of everything on this blog to a separate site where I can host text and graphics together -- which should make the graphics available even if they are no longer coming up on this site.  See  here and here


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