Thursday, June 29, 2017

You're 'Still In'? Too Bad for You. We're Out

Pure symbolism. That’s what “We Are Still In” really is.

“We Are Still In” is the petulant response of nine states — eight blue (CA, CT, HI, NY, OR, RI, VA, WA) and 1 red (NC) out of 50; 202 cities and counties (mostly in blue states) out of 3,144 (cities, counties, and county equivalents); 308 institutions of higher learning out of 4,140; and 1,530 “businesses and investors” out of 18.2 million businesses and about 160 million owners of stocks to President Trump’s announcement that the United States is withdrawing from the Paris climate accord.

In other words, 18% of states, 6% of cities and counties, 7% of institutions of higher learning, and 1% of businesses (if you count all the “still in” investors as businesses) or 0.001% of businesses and investors (if you count all the “still in” businesses as investors) are “still in.”

The larger the entity, the higher the percentage that are “still in.” Might that be because those decision-makers that are closer to the people they represent are less likely to embrace Paris?

Since the nine states that are “still in” account for about 34% of the country’s gross domestic product, you might think their being “still in” represents 34% of the American economy. But what makes those states “still in” is simply their governors signing on. None passed a referendum. None of their legislatures voted them “still in.” And the fact that only about one in 100,000 businesses and investors have signed on suggests that the percentage of the American economy truly represented as “still in” is actually minuscule.

Only 52% of all voters considered the environment “very important” — 69% of Clinton voters and 32% of Trump voters. And climate change isn’t all there is to “environment.” Only 47% of all voters considered climate change very important — 69% of Clinton’s voters and 32% of Trump’s.

So the “We Are Still In” website’s claim to represent “a sizeable percentage of the U.S. economy,” let alone a sizeable percentage of Americans, is baloney.

And what does it mean to be “still in”? It means those states, counties, cities, colleges, businesses, and investors say they’ll “pursue ambitious climate goals.”

For the cities, the pledge is a repeat performance.

In 2005 Greg Nickels, mayor of Seattle, started the “Climate Protection Agreement,” pledging to cut carbon dioxide emissions to 7% below 1990 levels by 2012. Mayors of over 1,000 other cities joined.

How’d they do?

Todd Myers, writing in National Review, reports that he contacted the mayors of thirty of the cities in Washington who signed on to find out how they’d done. Two-thirds didn’t know what he was talking about — i.e., their cities had forgotten the pledge.

Seattle had remembered, though, and found that it had reduced to only 1% below 1990 emissions — 1/7th of its goal.

New York, where then-Mayor Michael Bloomberg had pledged in 2007 to cut emissions to 30% below 2005 levels by 2030, will miss that target at the current rate. His successor, Bill de Blasio, pledged to reach 80% emission reductions by 2050, but “the city is already more than 4 percent behind and will need to reduce emissions at more than four times the current rate to have any hope of meeting [the] goal.”

Chicago Mayor Richard Daley pledged to push emissions to 25% below 1990 levels by 2020. Right now its emissions are 10% higher than needed to be on track for that goal, and its “Climate Action Plan” says the current trend will leave it at more than 1/5th above 1990 levels and 3/5ths above its target.

Myers is right to say, “The failure of these cities to achieve existing goals is a stark demonstration of the gap between environmental rhetoric and results from those who style themselves as environmental heroes.”

Such green hypocrisy is par for the course.

Of course, even if those “still in” manage to keep their pledges, the impact on global temperature will be indetectably small. Complete implementation of the Paris agreement by all 195 signing countries would cut only 0.3˚ from global temperature in 2100, at a cost of $23.3 to $46.6 trillion per tenth of a degree. No wonder the author of "The Art of the Deal" considered it a bad deal!

From all the rest of America to those who are “still in”: You might be, but we’re out, and gladly so.


Can’t grow the economy and prevent default without expanding the electric grid

The nearly $20 trillion national debt will consume economy if we don’t start growing robustly — and soon

Here are some sobering numbers. Since the year 2000, the debt has been growing nominally at almost 7.7 percent a year. But the economy, before adjusting for inflation, has been growing much slower at little more than 3.9 percent a year.

As a result, the nation’s debt to Gross Domestic Product (GDP) ratio has grown, from 55 percent to 104 percent today in just 17 years.

If these two factors remain constant, in 20 years, the national debt will be a whopping $96.4 trillion while the economy’s GDP will only be $40.8 trillion — a unimaginable debt to GDP ratio of 236 percent.

In 2016, the U.S. paid $429.9 billion of gross interest owed on the debt, according to the Office of Management. That is an effective interest rate of 2.2 percent. At nearly $100 trillion of debt, well you can do the math, that would be $2.12 trillion of annual interest payments.

That’s a lot. In 2016, the government collected almost $3.3 trillion in tax revenue. If the economy were to really grow to $40.8 trillion by 2037, one might expect revenues to rise to an annual $7.2 trillion in that time, that is, if the revenue to GDP ratio remained constant.

Even then, about 29 percent of the federal government’s tax revenues would go to paying interest owed on the debt. Right now, that ratio is a little more than 13 percent.

Are you seeing red? Perhaps that’s because your eyes are now bleeding. Can you say downgrade? Nobody wants to admit the problem, but we’re practically whistling past the graveyard at the moment.

The solution, naturally, would be to balance the budget as quickly as possible. To its credit, the Trump administration has proposed a budget that gets to balance within 10 years, with $4.5 trillion of real spending cuts off of the government’s projected baseline spending over the next decade.

But we know how Congress deals with these matters. The President’s budget is never adopted. All Congressional “leaders” — I use the term generously — appear myopically capable of in recent times has been simply approving the same budget year-in, year-out.

Again, assuming nothing changes fiscally and to do with economic growth, the debt to GDP ratio will be a shocking 236 percent by 2037.

So, if Congress is not going to do anything to help, which, why would they? Sorry to be a pessimist but perhaps when Congress actually does something to lower the debt to GDP ratio on its own, which given how slowly the economy is growing, would practically require a balanced budget overnight, then we can change that assumption. In the meantime, nobody should expect Congress to solve our fiscal woes on its own.

Not without some help from the economy, that is. Yes, the other way to reduce the debt to GDP ratio would be to rapidly expand the economy, nominally faster than the debt.

Meaning, almost everything you can think of. Cut taxes, bring production back into the U.S., slash regulations, lower health care costs, incentivize investment in U.S.-based businesses and a key one not often discussed, expand the U.S. electricity grid.

In the past decade, the U.S. electricity grid has not produce any additional electricity. We produced 4 trillion kilowatt hours in 2007 and 3.9 trillion kilowatt hours in 2016. No growth whatsoever.

No wonder the economy has barely grown the past 10 years, which adjusting for inflation, was the worst economic growth since the GDP was invented as a measure.

Therefore, one of the greatest impediments to growth — which will make us go bankrupt and if you need a reminder see above — is the inability of the federal government to allow the electrical grid to expand. Instead, we’ve been closing power plants, leaving little spare capacity for the economy to grow.

This week, President Donald Trump is promoting energy week and will talk up American energy dominance at a speech in Washington, D.C. on Thursday. Given the state of the economy after enduring the Obama administration’s power-freezing regulations, the emphasis on expanding U.S. access to energy is particularly well-timed.

It’s a rather simple choice for the nation and for the establishment in Washington, D.C. that foisted these regulations upon us. The economy cannot grow without expanding the electric grid. And if we do not grow the economy, we’re going to go broke.


NOAA: Record 140 Straight Months Without Major Hurricane Strike

Saturday, June 24 marked the completion of a record 140 straight months since the last major hurricane made landfall in the continental United States, according to the National Oceanic and Atmospheric Administration (NOAA).

The last major hurricane to hit the continental U.S. was Hurricane Wilma, which struck Florida on Oct. 24, 2005. According to NOAA, four major hurricanes hit the continental United States that year. They included Wilma, Rita, Katrina, and Dennis.

But since Wilma, no Category 3 or above hurricane has made landfall in the continental United States, making June 24, 2017 the end of a record 140 months without a major hurricane strike.

Prior to this 140-month stretch without a major hurricane strike, the longest major hurricane drought was the 96 months between September 1860 and August 1869.

NOAA has published data on all hurricanes striking the United States since the year 1851.

A "major hurricane" is defined as one that is Category 3 or above on the Saffir-Simpson Hurricane Wind Scale, which means it has sustained wind speeds of more than 111 miles per hour and is capable of causing damage that is “devastating” or “catastrophic.”

NOAA is currently predicting that an "above normal Atlantic hurricane season is likely for this year.”

"For the upcoming Atlantic hurricane season, which runs from June 1 through November 30, forecasters predict a 45 percent chance of an above-normal season, a 35 percent chance of a near-normal season, and only a 20 percent chance of a below-normal season," NOAA says on its website.

"Forecasters predict a 70 percent likelihood of 11 to 17 named storms (winds of 39 mph or higher)," says NOAA, "of which 5 to 9 could become hurricanes (winds of 74 mph or higher), including 2 to 4 major hurricanes (Category 3, 4, or 5; winds of 111 mph or higher)."

"An average season," said NOAA, "produces 12 named storms of which six become hurricanes, including three major hurricanes."


EPA’s Carbon Capture and Sequestration Is a Taxpayer-Funded Boondoggle That’s Destroying American Coal

A power plant once heralded by the Obama administration as the poster child for clean coal is now on its deathbed.

The plant hemorrhaged billions in cost overruns despite being heavily subsidized by the federal government. Mississippi regulators are ready to pull the plug.

Southern Company’s Kemper County Energy Facility had intended to use carbon capture and sequestration technology to gasify the coal, but instead, the plant has been running on natural gas since 2014.

The Mississippi Public Service Commission has unanimously passed a motion that the plant should only use natural gas moving forward.

The Obama administration touted the Kemper plant as a leading example of how a power plant would operate under climate change regulations for new power plants.

The regulations set new standards for carbon emissions that power plants could only meet by using carbon capture and sequestration technology. This would effectively have banned new coal-fired power plants from being built.

But carbon capture and sequestration technology poses its own obstacles. There is in fact no credible basis to state that it is adequately demonstrated proven technology, since no large-scale power plant in the United States currently uses it.

Yet it seems as though politicians and regulators in Washington may have watched “Field of Dreams” one too many times.

Adapting from the famous line, “If you build it, they will come,” the Environmental Protection Agency and Department of Energy urged with regard to coal, “If you regulate and subsidize, the technology will come.”

In fact, former EPA Administrator Gina McCarthy claimed, “Rather than killing future coal, [the new rules] actually [set] out a certain pathway forward for coal to continue to be part of a diverse mix in this country.”

In the EPA’s regulatory impact analysis for the proposed New Source Performance Standards for new power plants, the EPA wrote:

“The EPA intends this rule to send a clear signal about the current and future status of [carbon capture and sequestration] technology. Identifying partial implementation of [this] technology as the best system of emission reductions for coal-fired power plants promotes further development of [carbon capture and sequestration], which is important for long-term CO2 emission reductions.”

From the subsidy side of the equation, former Energy Secretary Ernest Moniz chimed in, stating that “[s]ince the beginning of the administration, [the Department of Energay] has invested around $6 billion to advance clean coal technologies—particularly in carbon capture, utilization, and storage—that substantially reduce carbon emissions.”

Years and billions of dollars in cost overruns later, the fact remains that carbon capture and sequestration is a taxpayer-funded boondoggle. Southern Company’s Kemper plant in Mississippi, a stimulus handout recipient, has been plagued with delays and cost overruns.

The estimated cost, initially projected at $2 billion, now stands at $7.5 billion, making it the most costly coal-fired electricity generating unit in U.S. history and causing Moody’s Investors Services to downgrade Mississippi Power’s ratings in March 2017.

Two years ago, Mississippi Power applied for a 41 percent rate increase to offset construction costs.

One issue at hand is the definition of so-called clean coal.

Many environmental activist organizations believe clean coal is oxymoronic. That’s simply not the case. Regulations required coal-fired power plants to install scrubbers that significantly reduce the pollutants like soot and chemicals that have adverse public health impacts and environmental costs.

Technological improvements have improved efficiencies of power plants, reducing emissions. Overall, the pollutants known to cause harm to public health and the environment have been declining for decades.

The definition of clean coal commonly used today includes coal without any carbon dioxide emissions. Carbon dioxide is a colorless, odorless, nontoxic gas that does not have any direct human health impacts.

Our coal-fired generating units in the U.S. without carbon and capture sequestration do not run like those in China. Coal in America is already clean.

The failure of the Kemper plant should raise a giant red flag for policymakers, regulators, and White House officials. Appropriators should not throw good money after bad. It’s time to end carbon and capture sequestration programs within the Department of Energy.

The EPA should roll back Obama-era regulations for new power plants and emphasize that carbon and capture sequestration technology should be used only if companies believe it is in their economic interest to do so.

Technological innovation in energy markets moves at a blistering clip, far outpacing Washington.

But that doesn’t mean policymakers can dream up ideas and use taxpayer-funded subsidies and its regulatory power to bring that wishful thinking to fruition. It is a waste of money and diverts resources away from other competitive uses.

Like Mississippi’s Public Service Commission, Washington should pull the plug on clean coal.


An energy consultant says "Green" South Australia will soon pay the most in the world for electricity

An energy market consultant says South Australian homes will soon be paying the highest electricity prices in the world.

Energy market consultant Bruce Mountain says SA will overtake Denmark on Saturday when electricity retailers hit most households with an average rise of about 18 per cent.

"My estimate is that the representative household in South Australia is paying a price that is a little bit higher than the representative household in Denmark or elsewhere and Denmark has known to be the highest," Mr Mountain told ABC radio on Wednesday.



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