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Seven States of Energy Debt
Posted by Gail the Actuary on February 10, 2010 - 10:16am
This is a guest post by Gregor Macdonald. Gregor's blog is gregor.us.
The inevitable coming of the sovereign debt panic finally engulfed Europe last week as the derisively (or perhaps affectionately) named PIGS spilled their slop on the continent. But Portugal, Ireland, Greece, and Spain are hardly worthy of so much attention. In truth, they are little more than the currently favored proxies among the leveraged speculator community (cough) for the larger problem of all sovereign debt. Indeed, the credit default swaps on these smaller European satellite states were not alone this week in making large moves higher. UK sovereign risk rose strongly, and so did US sovereign risk. With a downgrade warning from Moody’s to boot.
Notable among three of the PIGS are their relatively small populations, and small contributions to either world or European GDP. While Spain has a population over 45 million, Portugal and Greece have populations roughly equal to a US state, such as Ohio–at around 10 million. And Ireland? The Emerald Isle has a population similar to Kentucky, at around 4 million. While the PIGS are without question a problem for Europe, whatever problems they present for Brussels are easily matched by the looming headache for Washington that’s coming from large, US states such as California, Florida, Illinois, Ohio, and Michigan.
I’ve identified seven large US states by four criteria that are sure to cause trouble for Washington’s political class at least for the next 3 years, through the 2012 elections.
These are states with big populations, very high rates of unemployment, and which have already had to borrow big to pay unemployment claims. In addition, as a kind of Gregor.us kicker, I’ve thrown in a fourth criterion to identify those states that are large net importers of energy. Because the step change to higher energy prices played, and continues to play, such a large role in the developed world’s financial crisis it’s instructive to identify those US states that will struggle for years against the rising tide of higher energy costs.
First, let’s consider a large state that didn’t make my list. Texas didn’t make the list because its unemployment rate has not risen high enough to reach my cutoff: a state must register broad, U-6 underemployment above 15%, and currently Texas has only reached 13.7% on that measure. Also, Texas’s total energy production nearly perfectly matches its total energy consumption. Of course, Texas has indeed had to borrow more than billion dollars so far to pay unemployment claims, thus technically bankrupting its unemployment trust fund. That meets my criteria. But, it’s instructive to note Texas’ energy production capacity in this regard, as that produces dollars. And one of the big reasons US states are under so much pressure, like their European counterparts, is that they cannot print currency. Being able to produce oil and gas is the next best thing to printing currency. So, Texas doesn’t make my list.
The seven states to make my list are California, Florida, Illinois, Ohio, Michigan, North Carolina, and New Jersey. Each has a population above 8 million people. Each has had to borrow more than a billion dollars, so far, to pay claims out of their now bankrupt unemployment insurance fund. Also, each state currently registers broad, underemployment above 15% as indicated by the U-6 measure for the States. And finally, each state is a large net importer of either oil, natural gas, electricity, or all three of these energy sources.
Let’s consider the overall predicament for residents of states like California, with its epic housing bust, Ohio and Michigan at the end of the automobile era, or North Carolina and New Jersey in light of the financial sector’s demise. Not only have states such as these permanently lost key sectors that once drove their economies, but, residents in these states are over-exposed to structurally higher energy costs. The prospect for wage growth in the United States is now dim. We are already recording year over year wage decreases in real terms. The culprit? Energy and food costs. My seven states are squeezed hard at both ends: no wage growth at the top, and no relief through cheaper energy costs at the bottom.
US wage growth in real terms has been stagnant for years. And the most recent decade of higher oil prices has been particularly punishing to states over-leveraged to the automobile like California, Florida, and North Carolina where highway and road systems dwarf public transport. While it’s true that states like Ohio and California produce some oil and gas, the size of their populations overwhelm any production with outsized demand for electricity and gasoline. In contrast, and as I mentioned, it will be revealing to see how this depression ultimately plays out in such states as Colorado, New Mexico, Wyoming, Oklahoma, North Dakota, and Louisiana which are all net exporters of energy.
Were it not for peak oil, gasoline prices would have fallen to a dollar during this depression as oil returned to the lows of the late 1990’s–if not even lower. Petrol at 90 cents a gallon would begin to chip away at the painfully decreasing spread between punk wages and energy input costs, currently endured by underemployed Americans. Natural gas and coal prices are also much higher than they were at the lows of the 1990’s. And I need not remind: while energy prices are very 2010, the American workforce has lost so many jobs that our labor force has indeed returned the 1990’s.
21st century energy prices overlaid on a 20th century economy? That’s no fun at all. The mainstream economics profession, perhaps unsurprisingly, still does not pay enough attention to the interweaving of long-term stagnant wage growth, higher energy inputs, and the resulting credit creation that OECD countries took as the solution to resolve that squeeze. Given that one of out of eight Americans takes food stamps, a visit to states like Illinois, Florida, Ohio, and North Carolina would reveal that the difference between 15 dollar oil and 75 dollar oil, and 2 dollar natural gas and 5 dollar natural gas is large.
My seven states of energy debt represent a full 35% of the total US population. As with other US states, they face looming policy clashes between protected state and city workers on one hand, and the growing ranks of the private economy’s underemployed on the other. The recent circus at the LA City Council meeting was a nice foreshadowing that the days of unlimited borrowing by governments–against future growth based on cheap energy–is coming to an end. Washington can print up dollars and fund these states for years, if it so chooses. But just as with the 70 million people in Portugal, Italy, Greece and Spain, the 108 million people in these seven large states are probably facing even higher levels of unemployment as austerity measures finally slam into their cashless coffers, and reduce their ability to borrow.
Photograph: from FREZNO, a new book of photos by Tony Stamolis, available now at Process Books. (I bought a copy and it’s brilliant. For those who study California, it’s a must-have addition to your bookshelf).
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I've been telling people for over a year that the real pain hits the US economy this summer when the new fiscal year begins for most states. Declines in sales tax revenue are coming home to roost, and my state (Colorado) is entering a new assessment cycle on property taxes. It remains to be seen how the real estate crash will play out in terms of property tax revenues here, but it can't be pretty. School districts are already in crisis mode, knowing that their funding will be cut drastically next year. Rumor has it that ALL non-tenured teachers in the local districts are going to be cut, resulting in 40+ student class sizes. The public school districts are seeing increases in enrollment, not because of population increases, but because of people transferring their kids out of now unaffordable private schools.
I regret seeing NC on your list, but I still would rather be here than in any of the other 6 - or indeed, in any of the other 43.
The state was really hurt by globalization, as the textile mills mostly closed and went overseas. That was a big mistake in national policy, IMHO. We can live without Big Mouth Billy Bass, and maybe we can live without new fashions every six months, but people do need clothes, and we really do need to retain the capacity to make them here in the US. Maybe when the dollar falls far enough some of the textile manufacturing will come back.
The overemphasis on banking and finance in the Piedmont and on tourism in the east and west is another big mistake. Finance has been shedding jobs like crazy, and tourism can't be far behind.
Probably the one good move that NC has made on the employment front has been to encourage the development of biotechnology industries in the RTP (Research Triangle Park) and around the state. We have a pretty good community college and university system, too, and that helps a bit.
The borrowing for the Unemployment Trust fund is troubling, but not out of line with what is being experienced around the nation. The basic assumptions underlying the entire system were faulty, so this is a systemic, and not state-specific, problem.
As for energy, 40% of our electricity comes from nukes, and the initial paperwork for 7 more have been filed with the NRC. Some of those are to replace decommissionings, but we might be able to bump up to 45-50% if these are not beset with huge delays. We also get some hydroelectric from the TVA dams. It is true, though, that we must import all of our coal, NG, and petroleum from elsewhere, and that is a problem. Longer term, NC has very good potential for wind energy, and fairly good potential for solar and biomass. However, it really all comes down to energy efficiency and conservation - that is where we are really going to have to close the gap.
Transport, of course, is the big one. NC is one of the few states to have made significant investments of state funds in passenger rail. As a result, there is better passenger rail service between Raleigh and Charlotte than there is between most large cities outside of the NE corridor. Further improvements are underway; NC was a recipient of $500M of federal grants to upgrade this line. It won't really be European or Asian style "high speed", but they will be able to segregate the rail line from highway crossings, etc., allowing a considerable increase in speed from what is presently possible.
There also has recently been a successful introduction of light rail in Charlotte; undoubtedly, this system will be expanded further in the future. Planning is also underway for a system in the Triangle (Raleigh, Durham, Chapel Hill area), which badly needs it.
While all this is good, much more is needed. There are plans to extend passenger rail service to western NC, but these have been stuck on the back burner for years due to lack of funding. Somehow, funds have to be found to get this on the front burner. After that, further plans need to be developed and implemented to provide a more extensive passenger rail network throughout the state. There is also a need for more urban mass transit. It will all take time, and much money - more of both than we have.
The state has been investing way too much money in highways. Much of the priority seems to be in reducing congestion around the major metro areas. To the extent that this reduces traffic jams and vehicle idling times, that makes a small contribution to fuel efficiency. However, it also encourages more spawl, of which we already have way too much. We really need to increase our state motor fuel tax rates; we are presently #14 in the nation, we need to be higher. Higher motor fuel taxes would discourage automobile use, and would also generate more funds, which IMHO should go toward passenger rail and mass transit. That will be a hard sell, though.
We also need to do much more to promote residential and commercial energy conservation & efficiency. Again, it requires more money and time than we really have.
The state is presently in the process of revising its energy plan. I'll be interested in seeing it when it comes out. Unfortunately, I'm afraid it will still be far too BAU oriented.
Conservation will happen but not in a nice way.
We left the Triangle last year for various reasons, both PO related and not. The TTA's rail project was on the cusp of breaking ground when in stepped the 500 lb gorilla to say "No way, Jose." One of the last details to be finalized before construction was the siting of a station near Duke and its medical center. Each separately are among the largest employers in Durham, and collectively are certainly the largest. But the highly educated, forward thinking bigwig Blue Devils wanted nothing as 'common' as a mass transit station anywhere near their hallowed grounds. So the project was taken from ready to go, all the way back to square one - years of delay. Thanks, Duke!
Yes, it has been painful to see the floundering around and wasted years. One wonders how many people who might have enthusiastically gone for Transit Oriented Development just gave up in dispair and surrendered to the suburban sprawl/freeway commute thing.
They needed to just start with a core backbone that was guaranteed to have good ridership numbers, and call it "Phase 1", with the promise of additions later. Lesson there for everyone.
Why not allow cab companies to run mini buses like the airport shuttle sized 20 passenger vans?
Create jobs and improve energy efficiency at the same time.
This can be an option in communities without public transport. There will be considerable opposition in cities with public transport and their relatively well paid employees.
Sort of like the commuter planes now command 51% of all flights,(frontline a couple of days back)
A similar low cost option would be just providing some public spaces for park n ride. In many places these park and rides get filled up very quickly, Cannot see why the public transport authorities themselves buy the land to create more ridership.
That will pretty much be what happens by default for those cities that can't get their act together and put in something with rails while they have the opportunity to do so.
I guess the advantage of shuttle buses, taxis, and jitneys is that with some work they could be modified to become horse drawn. That is what will happen by default after the first thing that happens by default.
Hello Clifman,
I live in Durham and did some serious thinking about the TTA rail. To me, it was short term expedient in that they were going to share the existing trackage through Durham with Norfolk Southern. Progress out 50 to 100 years, that would create a bottle neck. You'd have NS and TTA trying to schedule use of those tracks for different purposes. TTA rail needed/needs to develop its own "right of way". Less potential for a serious accident from poor coordination.
Also, I've been side tracked on a Pennsy passenger train to make way for a slower freight train. We spent hours there. Although that was many decades ago, the thought of having to make it home only to be side tracked because of priority freight train traffic still does not sit well in my mind.
The third point was that it would add about an hour one way to my commute. I'd either have to drive or ride a bicycle to the Duke station and park (20 minutes total), wait for the train (5 minutes), arrive at the RTP station (20 minutes), switch mode to a local shuttle (5 minute wait plus 15 minutes to work), or ride my bike (24 minutes or walk 3 miles to work (1 hour). If I go by car during inclement weather, then I have to pay the Duke parking garage rate. Instead, I've opted to carpool with my neighbor who works at the same place. Push comes to shove, we might even join a van pool.
My thinking is that products like the Nissan Leaf (100% EV) will develop. Add solar hot water and PV to my home to compensate for recharging a Leaf like electric vehicle and I won't see a spike in my electric bill. The Solar Hot Water and PV will eventually pay for itself. Tires and batteries will be the biggest expenses. I understand that it takes 7 barrels of oil to make a set of tires - not sure how true that is.
I really **DO** like mass transit. When in Boston, I can get around very well on the "T" and buses. The same applies to the NYC area where I grew up. The RTP area is so spread out that mass transit here is not efficient, economical, nor productive. I'd love to use TTA rail like I used the "T" and NYC mass transit but to me this iteration of TTA rail was expensively flawed. I also think their ridership projection numbers were too high.
I eventually could see the TTA using part of the Durham Freeway right of way instead of the NS tracks. Not sure of how they would thread the tracks through the downtown area and integrate TTA with their new transportation hub where the old Downtown Motel used to be.
I'd love to hear more of your perspective.
Thx for your response. You've obviously paid more and closer attn to the issue than I did. But my basic position aligns with that of WNC - the Triangle should get a trunk line in place, attract TOD, and build from there. And while I applaud your investment in solar hot water and PV, (we have/are doing the same in our new location) my view of the future is clearly more doomerish than yours. I think the commute by car/BAU model will be coming apart at the seams this decade, and that anything in place to mediate the impacts would be wise, passenger/freight conflicts notwithstanding. I like your idea of using the Durham Freeway ROW. I used to live not far from the western end of it - near the Eno Quarry (best swimming hole in the Piedmont), if you know where that is.
That seven barrels of oil to make a set of tires figure is highly suspect.That's around five hundred dollars worth of oil, and you can by a decent set of tires for small to medium size vehicles at retail for that or less.
I would guess that if the electronics are dependable an electric car , except for the battery will last almost forever, if it is well maintained and doesn't die from rust.
If you don't drive it much, taxes and insurance may run more than maintainence.
I believe that should be 7 gallons of oil per tire
I'm thinking that I may have recently heard a quote about 7 Gallons of Oil per Tire (Gallons NOT Barrels). This may have been from that well-reviewed new film "Collapse" featuring the great Mike Ruppert, who famously wrote "Crossing the Rubicon".
"As for energy, 40% of our electricity comes from nukes, and the initial paperwork for 7 more have been filed with the NRC. Some of those are to replace decommissionings, but we might be able to bump up to 45-50% if these are not beset with huge delays."
A lot of people are talking about nuclear power, including the DOE, as if it is a long-term solution. I'm not trying to be a doom and gloomer, but there are serious questions about the future supply of fuel for nuclear reactors. Again, like everything else, overpopulation has put an unsustainable burden on our natural resources. From MIT's Technology Review:
Perhaps the most worrying problem is the misconception that uranium is plentiful. The world's nuclear plants today eat through some 65,000 tons of uranium each year. Of this, the mining industry supplies about 40,000 tons. The rest comes from secondary sources such as civilian and military stockpiles, reprocessed fuel and re-enriched uranium. "But without access to the military stocks, the civilian western uranium stocks will be exhausted by 2013, concludes Dittmar.
It's not clear how the shortfall can be made up since nobody seems to know where the mining industry can look for more.
http://www.technologyreview.com/blog/arxiv/24414/
I don't see nukes taking us much farther than the end of the century, and maybe not even that long. But they might help tide us over while other adjustments are being made.
Washington didn't make your list of seven, and neither did our friends in Oregon, but both states also have serious fiscal problems.
By no means do there not exist the resources to fund state services and capital projects to the level expected by citizens. But returning the states to fiscal health, without throwing the population's needs under the bus, requires some creativity for which not all of our legislators and governors are renowned. California's dysfunctional political system is well-documented. In Washington, we have similar problems. It is extremely difficult to raise or even maintain revenue without tax-cutting initiatives appearing on the ballot, and any proposed changes to state employees' compensation meets with seemingly insurmountable resistance.
We continue to fight against the tide of wage depression, but sometimes it seems futile. We recently lost a Boeing plant to lower wages in South Carolina. Despite problems with Washington Mutual, the state's economy, and particularly Seattle's economy, continue to outperform the national average. Our housing bubble was not as severe as in many other places.
On the energy front, Washington is also an importer of fossil fuels, though we're probably better off that most of the other importer states. We generate significant amount of hydro power (shh, don't tell California), have a temperate climate, and a Growth Management Act which has kept our consumption somewhat under control. We have mostly phased out coal burning, and environmentalists are trying to speed up the timetable for shutting down the state's last coal plant in Centralia.
Will be ok in California, if she wins the governors race, Meg Whitman will save us.
I would place my faith in drugs - no matter who wins
My own state of Virginia has troubles too. There is a 2bn$ deficit that needs to be closed, and the new Governor has a kind of deer-in-the-headlights look. He is adamant about there being no new taxes, but the cuts are going to have to be deep to find 2bn$, and he doesn't want to take the blame as those kinds of cuts will be unpopular.
The former governor did submit a budget, and the tradition is that the incoming governor makes amendments to make it more to his liking. The tradition is also that the first move is made by the Governor and not by the House. Yet we haven't seen any amendments yet, and the House is getting antsy as they need to get started on something soon.
I made the 35 mile trek over the mountains to work yesterday and when I was still about ten miles from the shop my low fuel light came on. I knew that I would make it to work, and that I could use my tip money to buy fuel to get back home. About the time my fuel light came on I was passed by a large SUV with govt. tags. I didn't think much about it except to think that if this govt. employee would slow down a little it would save the tax payers of the county a few dollars. As I pulled into work, there was the SUV, its driver unloading three dogs to be groomed. I realized that this woman was hurrying to make her appointment at the dog groomers and get to work on time at the Sherrif's office. Her trip to the dog groomer's had taken her about twenty miles out of her way on the public tab and her return trip that evening doubled that. I wonder, at what point will these people wake up and get it? We do appreciate her business!
I left for work again this morning, thankful that I had enough appointments to work two days this week. It's our slow season and the economy has reduced appointments to one or two days a week. As I began my trek over the mountain again, the road became dangerously icy, as the roads had not been salted and the light snow was turning to black ice. Rather than risk an accident, I turned back, never once seeing a salt truck or plow. It is apparent that the county has exhausted their salt/fuel budget. I called the shop, knowing that my grooming partners could take care of my appointments and would be glad to have the income (they live above the shop). As I made my treacherous way back down the mountain I noticed folks heading up the icy slope at speed. It occured to me that this is analogous to our society meme. Whether it is PO, GW or the economy, most folks will keep going full speed ahead until they can't, until they crash and burn. At least as far as the icy roads are concerned, I have the option of turning back.
As I came off of the mountain I was passed by the rescue vehicles and an ambulance heading the other way. Nice to know they still have fuel and jobs. I live in one of the states on Gregor's list of seven.
Most jurisdictions have (and all should have) policies requiring public employees to drive public vehicles at or below speed limits, and prohibiting their use for personal use. If a few citizens would start calling in a reporting a few license plates, I suspect that compliance with these rules would increase substantially.
I agree WNC. I have two problems with that: She's a customer and these are very small counties. When doing the right thing equates with doing the stupid thing, best to do nothing in these tenuous times. Too bad I didn't have a video camera. Send the Sherrif an anonymous video, for all the good it would do. These folks really don't care. It's the hubris of authority, and they know they have the support of the most influential part of the populace (business owners, the newspapers and the churches).
If she becomes aware of this incident being posted on TOD , she will probably take her business elsewhere.
If it comes to the attention of the public in such a way that the sheriff or board of supervisors are embarrased, she will be fired-NC has laws against using a publicly owned vehicle for personal errands.I 'm suprised -but only a little- that she is allowed to take it home,unless she is a patrolling deputy.
I don't know her job status but if she's ever heard of TOD she probably thinks it's some kind of frog. It's the next county over from mine. I see public vehicles parked at workers' homes often. It seems to be one of the shadow benefits in these parts. She may be a detective as far as I know. "Ribbit, croak, ribbit!"
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Georgia is not on the list, because it hasn't yet had to borrow more than $1 billion to bail out its unemployment compensation system, but it seems to have made it on the other criteria. Revenue is still falling. The front page article today says:
January brings no relief as state revenues fall again.
Georgia probably started out in better financial shape than the others, but we definitely are dependent on imported energy--pretty much everything is imported.
Georgia's high rate of bank failures won't help much.
Hi Gail
I expect you may be on some sort of list now...;¬)
In response to the queens complaint that the economic collapse was not picked up by her advisors - reported on BBC TV news tonight.
This email sent to the Buck Palace website administrator:
I'm not sure this is the kind of exposure Gail needs, Doug. (You better study up on your Royal etiquette, Gail. You may be summoned to the palace soon :-> )
I do not doubt in the least that those seven states are in bad shape from a fiscal and employment standpoint and that things will probably get a good deal worse for them than they are now.
However, I have some trouble with this notion that it is significant whether a state is a net importer or exporter of energy, for a number of reasons.
First, the price of energy for the consumer does not vary all that widely from state to state, particularly for liquid fuels such as gasoline and heating oil. During the recent run-up in gasoline prices, what was the largest spread in prices between states? I happen to live within a thirty-five mile radius of four oil refineries, and I pay just about as much for my gas as someone living several hundred miles away from the nearest refinery. Electricity is another matter, but even that tends to average out.
Second, none of the states operate their own energy companies (at least on a large scale). Thus, the revenue from an oil well in say louisiana does not go into the Louisiana state coffers, but rather to the oil company that owns the well, and that company may not be located in Louisiana (or in some cases not even the US). Of course, tax revenue from such operations help, but that is also true of any sort of business within the state, not just those involved in energy production.
I tend to think that the relatively small energy price differential between states is but a minor factor as to why some states are in worse shape than others. I can't help noticing that at least four of the seven states also have large immigrant populations and large welfare roles. That, plus a weak manufacturing base, poor fiscal management, and a whole variety of social pathologies are probably far more important than energy.
Of course, high energy prices can act as the straw that broke the camel's back, helping to push people at the margin over the edge, but I just don't see how a state's being a net energy importer or exporter makes much difference in that regard.
joule -- a little modification of your thoughts on oil/NG revenue in Texas and La. I don't have time to dig the numbers out but both states receive directly from production. La. takes in a huge revenue stream from severence tax only. The state collects 12.5% of the sales price of every bbl produced in the state. And $0.30 for every mcf of NG produced. As I type I'm sitting on a drilling barge in S. La. If we are fortunate enough to find the reserves we see as potential, the state will receive $200 million in severence tax from this one new field discovery alone. Texas also collects severence tax. Individual counties/parishes also collect production taxes. Then there is the regulatory income: permits, etc. Beyond that both states own a great deal of mineral leases. All minerals under state water bottoms (rivers, lakes) belong to the state. All minerals within the first 10 miles of the coastline belong to these states. Not only do they receive the lease bonuses (tens of $million/year) they also collect royalty payments that range between 15 to 25% of the GROSS value of the production. These minerals also have another great advantage: the royalty production portion belongs to each state. They are not obligated to sell this oil/NG to who ever wants to buy it. It certainly wouldn't go over very well with the rest of the country but either state can take its share of production inkind and ship it to any in-state refinery it choses. It can then mandate that the products be sold only in their respective state. The oil/NG and its products belong to the citizens of each of these states.
There's another revenue stream directly related to oil/NG production: production from the federal offshore leases. Though it hasn't always been so the states now receive a portion of this revenue. The Fed royalty normally runs 16.6% of the GROSS revenue. I'll try to collect the total values when I have some time but needless to say it's significant. One simple example: much of the operational expenses of the Texas state university system is provided by huge tracts of state owned mineral interests in west Texas. The U.S. is the third largest oil producers in the world. And, at last count I recall, Texas produces more oil than any other state. And La. produces more NG then any other state.
ROCKMAN -
Evidently, I badly underestimated how much revenue states like Texas and Louisiana get from the various taxes, fees, and royalties associated with oil and gas production. However, based on my own personal observations, all that revenue hasn't been of all that much benefit to most of the people of Louisiana, as the state is typically pretty far down on the list with regard to a variety of societal indicators.
Be that as it may, I would imagine that those two states, along with perhaps Oklahoma, Alaska, and Wyoming (coal) are the exceptions when it comes to benefits from energy production. I also think that in some ways it is doesn't much matter whether it is energy production or some other revenue-generating big business. Don't forget that it wasn't all that long ago when places like Buffalo, Cleveland, and Detroit were vibrant prosperous cities due to the tremendous amount of manufacturing-related revenue being generated therein.
A thought of mine that keeps recurring is that state boundaries have become more and more obsolete and irrelevant, particularly when looking at economic output, energy policy, and environmental matters. I mean .... in this day and age does the concept of a 'Delaware' (my home state) make all that much sense? Hell, you could give the portion of this tiny state above the Delaware-Chesapeake Canal to Pennsylvania and the portion below it to Maryland and no one would notice much difference. So, I find it kind of a joke when some people in the Delaware state government talk about 'Delaware's energy policy', as if Delaware were some sort of an island country rather than an arbitrary political boundary encompassing a piece of land smaller than some Texas counties.
Good point joule about dependency. Back in the 70's Houston became very dependent upon the oil patch for jobs, taxes, etc. When the bust came in the early 80's it was really bad. Very similar to what we just saw with the national sub prime meltdown. It taught the city the need to diversify its tax base. I suppose that's the potential problem with any area that relies on very few industries to support its tax base. Human nature has them sit back and roll along during the good times. But when the good time end the pain quickly sets in. I suspect La. is a better example of this then Texas. Use oil patch revenue to keep other taxes low. But had they collected more taxes from the residents they might have provided better social services and such. But rasing taxes on individuals doesn't help win re-elections.
I agree with you about state boundaries becoming somewhat invisible. Except, of course, for Texas. Years ago I was with a tour group in the EU and the guide asked everyone to tell where they were from: France, Egnland, Germany, the USA. Of course, when it was my turn it was "Texas". The guide laughed. He said it never failed. US citizens almost always answered "USA"...except for the folks from Texas. It's not just your normal BS. Folks in Texas truly do hold them selves apart. Not saying that's good or bad. But it is a fact. If the Feds start loosing some of their power and states' rights come to the forefront some folks might be surprised just how strongly Texas might push that solitary status attitude.
ROCKMAN -
I'm quite familiar with that Texas attitude. Unfortunately, we Delawareans suffer at the opposite end of the scale.
A number of years ago I was an in-law's Christmas party in New Jersey. A whole bunch of cousins, neices, and their boy friends and girlfriends were there.
Well, I was chatting with this very attractive twenty-something sweet 'thang' who was one of the nephew's girlfriends. She was a Jersey girl through and through. She asked my wife and I where we were from, and when I replied, that we were from Delaware, a puzzled look came over her face, and she then hesitantly asked, "Isn't that in Maryland, or something?" I'm not making this up!
Don't they teach geography in public schools anymore?
Anyway, just like an ecology that is comprised of but a few species is very unhealthy, so it is that an industrial base is also unhealthy when it is highly dependent on but a few large industries.
Joule - what do you Delewareans think of the recent offshore wind proposals in your waters? http://www.upi.com/Science_News/2010/02/10/Md-report-optimistic-about-wi...
Jim MacInnes -
Many people in Delaware, including myself, think it's a great idea. But you have no idea of all the political intrigue, disinformation, and nasty in-fighting that was involved. It got pretty ugly. And it's still not 100% a sure thing, because financing may be a real problem.
Delmarva Power, and it's chums in the legislature down in Dover did their very best to strangle this baby in its crib, but they did not succeed. Utilities tend to hate wind power, partly because of its intermittent nature and also because they can't play all sorts of creative games with fuel surcharges and the like.
My own view is that there is probably a 50/50 chance that this wind farm will ever get built. It's a perfect example of what an uphill battle alternative energy faces. The people who benefit from the status quo have great deal of clout. A fact well worth remembering.
Yes, good points. I was at an offshore wind conference in Philly last week and it sounded like your governor was very supportive. Deepwater wind presented as did other developers. Jerome a Paris also did a nice presentation on European offshore wind project financings he has completed. At least the europeans are having some success and paving the way for others. I managed to have dinner with the project manager of DONG energy's Horn's Rev 2 project off the coast of Denmark. It was fun hearing about the challenges and success of this project.
China is beginning to move very fast on this too. http://www.renewableenergyworld.com/rea/news/article/2009/12/optimism-in...
I can assure you that we feel the same clout you are speaking about here in Michigan.
Rock, you guys are going to have to do something about healthcare after Texas declares its independence. Some of the highest Medicare expenditures per enrollee, along with FLA and LA. Must be all of that good Gulf air. CA an NY are high too. Not very up-to-date but I doubt it's gone down any:
http://www.cbo.gov/ftpdocs/89xx/doc8972/toc.htm
Point and click to see your state:
http://www.statehealthfacts.org/comparemaptable.jsp?ind=624&cat=6
Maybe someone can find more recent totals. I doubt were getting any healthier.
Interesting chart Ghung. I knew we were high but didn't realize we stood out so much nationally. Probably a combination of BBQ, beer and drunk driving accidents along with the occasion self inflicted gun shot wound.
looks to be a heavy concentration in the 'right to work states' so lack of healthcare coverage for the general and relatively low paid work force may play into those medicare numbers. The section of Montana, which is not a 'right to work' state, that stands out is in the area where there was significant asbestos exposure from of the Libby taconite mine, so other regions that hosted industries that exposed not only the workers but the nearby residents to extremely hazardous materials may also give these numbers a boost.
Really, back in the pipeline day Alaskan's said happiness was a Texan flying home with an Oklahoman under each arm. That was after we told the fellow to sit down and be quiet or we would cut our state in half and make Texas the third biggest state ?- )
No shortage of state pride up here, but this is the most egalitarian state in the union so there is a lot of positive nuance to being from here except when we run into the annoyingly rich Bush types. Its hard to get treated with much more genuine interest than when you tell someone your from Alaska...telemarketers often ask where the country of Alaska is ?- ) Texans ask us what part of the moon its on ?- )
Texas has a lot of military bases just like Alaska, it ain't going anywhere either. Just get someone from an Independence party elected governor, as we did in 1990, and watch that party's popularity evaporate. Of course we might get a little better deal from the feds than you guys. We were getting a buck and a half back from every buck we paid in fed income tax. Don't know that will be the case without sugardaddy Ted.
Hi Joule,
Insensivive and rednickish scumbag jingoistic flat out non pc not a polite thing for me to say of course, but all the extra faces in this part of the world are really putting a hurting on us (I live almost on the Va/Nc line)now that things have fallen apart.
Our recent arrivals are almost all Mexicans , nice decent people and good reliable hard workers, THE sort of people you don't mind having for new nieghbors-IF YOU MUST HAVE MORE NIEGHBORS.
The problem is that at least in the first generation virtually one hundred percent, and in the second generation for the most part, these new arrivals compete exclusively for the very jobs that poorly educated locak people have been traditionally dependent upon-jobs that unfortunately were in industies already experiencing seriuos if not terminal decline due to globalization.
Now as it happens , I have been ALLOWED to work even here in the state of VA ON SOME GGOOD JOBS THAT I WAS PERFECTLY WELL QUALIFIED TO DO when a union contractor was short of help, and the Teamsters magazine has been a regular in our mailbox for over fity years as a result of my Daddy's "part time" job in a manufacturing facility. I was once a member of a failly powerful union myself-The Operating Engineers.
So I do happen to know a little about the labor movement, and why unionized labor votes democrat on a regular basis..
Unionized workers with powerful unions in big industries don't have to worry about new arrivals -or anybody else - taking thier jobs, so long as they exist.
I have many liberal acquaintances and some liberal friends-about ninety nine percent of them work in professions where there is no danger whatsover of a new arival taking thier job, due to the lack of proper professional qualifications or the necessary paperwork background or the simple fact that they are govt employees and "in for life " or until thier retirement.
Meanwhile numerous people here, long time locals, are out of work and having avery tough time.
Now as far as I can concerned , I sort of think that most of my liberal buddies who have good jobs as teachers, nurses, social workers, it professionals, and owners of businesses that cater to the well off ,would be talking "out of the other side of thier mouth" if they had to stand in line and compete for an eight dollar an hour job with a few dozen people in that line who are ready and willing to acdept nearly any conditions ojt and any pay scale offered.
Now I do not post this to start a flame war today, I enjoy rhem, but I will be too busy.
I post this to enlighten those who never set foot across the railroad tracks to the other side of reality in America and cannot understand why poor working people so often vote republican and why they listen to Rush instead of NPR.
It's kinda simple , guys.They see open borders and illegal immigration as forced sex with no vaseline, themselves as the bleeding victims, and the holier than thou democrats as the rapists.
Of COURSE this is a rather blinkered view of the whole picture-my personal view is much broader.
But at least I know enough about the reality on the ground to UNDERSTAND these people.
I have worked with and around social workers and other well trained (supposedly) people engineers on many occasions and nearly of them have thier heads up thier butts so far that they are as blind to reality as the fundamentalist Christians we love to paint as ignorant and superstitious yokels.
(Incidentally they can read, and thier kids have internet, and they know what is being said about them in forums such as this one.NOT THE WAY TO WIN FRIENDS and allies !
An yes I myself one day use this language myself, out of recognition of the realities of this forum,and the next day defend religion-but as a natural part of the human experience and a survival machine, not because Iam a believer)
For instance , I have yet to ask one of them ( a social worker) why poor people use drugs and get THE right answer.
I'll rant about THAT another day.
No doubt, of course the old Newt Repubs really couldn't have a better Christmas gift than the abolition of minimum wage, so I'm sure everyone would be better off standing in line to compete for a $2.50 an hour job. Lived and worked with plenty a poor Repbulicans and even plenty of non-conflicted Republican union hands. The ideal of standing on your own without government interference and the right to openly display your firearms is the big draw. The union republican buying into that ideal is pretty funny when you know just what sort of structure has allowed their union wages to be put in place. Generally the poor Republican and the union one has about as coherent a world view as that Fox news person ex governor of ours. It worked real well for her though, hope the rest I mentioned (often big SP fans) can enjoys the fruits she has grabbed vicariously, cause she won't be sharing.
They see open borders and illegal immigration as forced sex with no vaseline, themselves as the bleeding victims, and the holier than thou democrats as the rapists. Of COURSE this is a rather blinkered view of the whole picture-my personal view is much broader.
It's not just blinkered, it's just wrong - it's employers who bring in immigrants and prevent real enforcement of immigration laws. Republicans love to build fences, because they don't work. Republicans will block real workplace enforcement of immigration law until the cows come home.
I knew Bernard C. Parks should have been Mayor. I am glad that south LA has political leadership that is realistic about our situation.
I don’t like the acronym PIGS or PIIGS… Some of my ancestors were “PIIGS…” I doubt that acronym would have been considered if Greece were replaced by Great Britain or Germany.
I’d rather be a “PIIG,” than an American suburbanite in a state like California or New York.
The acronym which includes the British is the STUPIDs - Spain, Turkey, United Kingdom, Portugal, Italy and Dubai. Perhaps we could call California, Ohio, and New Jersey the "CONs". In other words, being offended at acronyms that were created with the entire purpose of offending, especially when you and your nation face extremely serious fiscal consequences over the next several years, is a clear waste of effort. You might choose to place more effort on actually preparing yourself, perhaps through Jeffrey Brown's ELP vision, or perhaps through another approach. Worrying about other humans being offensive is rather a waste of time, so long as we're dealing with just words and not actual physical violence, precisely because humans have and will continue to behave in this manner whether we live in skyscrapers or caves.
I do find it amusing that Greece, with almost 180% debt to GDP ratio is expected to be bailed out by the "stronger" Germany, whose public debt to GDP ratio only approaches 160%. Meanwhile people castigate the United States whose public debt to GDP ratio is a mere 100%, so far. The humor of the situation, while grim, does give me reason to smile at the insanities of our species.
The financial truth is that none of the European states have sustainable financial futures. Of course, neither does the United States or Japan. And even China is rapidly blowing a gigantic real estate bubble that must implode. It might behoove people to consider the implications of a world in which no single major state is capable of continuing business as usual. The next decade could see dramatic change in ways that none of us alive can yet really anticipate. Those changes could be good, but are more likely to be bad. With such data in plain sight for anyone to see, failure to plan can no longer be laid at the feet of governments alone, but must be likewise laid at the feet of individuals who refused to act as the storm clouds gathered. Some governments may not even survive the next decade intact but almost certainly most of those reading this web site will.
Sweden has a 35% debt to GDP ration, it peaked at 76 % in 1996 and then it both were paid off and GDP increased. This were due to lessons learned from earlier crisises and we try to use the same methods for handling the current financial crisis, debt is going up now but it is not out of control.
https://www.riksgalden.se/templates/RGK_Templates/TwoColumnPage____2749....
But we are a small state and we would go instantly broke if we had to bail out a failing euro country.
There are definite islands of sanity in an otherwise insane world. Unfortunately those islands of sanity are small. I wish you the best of luck. Sweden will need it, given the state of many of its neighbors.
Based on 2008 GDP - look at how big some US States are vis-a-vis other entire countries. Of course - GDP is a pretty narrow boundary indicator.
I've spent a lot of time on city data forums and have noticed the increased numbers of people who want to relocate to Texas. The more locals that have to leave this area, the better :) In my book its not resources, but population that is causing all the problems.
What's the attraction to Texas for these people anyways? That state wouldn't be at the top of my list.
What a coincidence ericy...you're not at the top of Texas' list either. Guess it all worked out for the best.
Jobs?
...or so it would seem from reading comments. I also think weather has to be a big part of it, the summer's in Texas may suck, but winter sure is better then Minneapolis.
I watched something on TV about people moving up to N. Dakota for jobs. I just laughed. Give them a few winters. I've known some people that have moved to Florida up to Wisconsin and they usually turn right back around :)
Wisconsin people I know that have moved to Florida go there to die :-)
One of the happiest retired couples I ever knew, retired to small tract of land near the shore of Lake Superior between Hurley and Ashland. Of course, they were originally from Sweden.
Having grown up in Minneapolis, I guess I can say that the winters there don't bother me much, and the city is one that is generally very livable, and the people are nice.
When I moved to the DC area, my major complaint was that it was too warm year round. The summers were brutally hot and humid, and in the winter it wasn't cold enough for skating or skiing.
Austin is cool, but it is a least a half hour from Texas.
Just so you know trekker one of us here gets it. LOL
Gotta be one of few state caps that gets good 'press,' love their little 'City Limits' show. Once I get my fill of winter (a mere twenty years in the subarctic hasn't been quite enough) I figure to look at that the next biggest state. Austin might just be a bit too much city for this old Chi-town boy anymore though.
Maybe it is just me, but I find that to be a hilarious map.
This is a great, great map. Russia = New Jersey? Who would've thought?
I like Alabama = Iran! Too funny.
Not likely to go over too well with folks down there in the Heart of Dixie, though, unless the majority have changed a bit since my 6 months in Tuscaloosa about 30 years ago.
It isn't Alabama - it is Al-Abama.
Alaska = Belarus is pretty good, too. You could see Russia from there, except now it has moved to NJ!
Mind you we Alaskans manage that GDP with well under a million people a good many of whom don't ever seem to work. Enjoy your latest depression, I'm sure ours will come in counter to the rest of the country's cycle as usual.
After last Sunday night, I guess you could say that something is rotten in the State of Denmark.
A thought: If NC has the same GDP as Sweden, then we should be able to model our energy policy after theirs. NC and Sweden do in fact have a fair amount in common: Few FFs of any kind, some substantial investments in nuclear, and some good hydroelectric resources. Both have some good potential for biomass, wind, wave/tidal, and some geothermal. Both are fairly large in land mass, but with the main population centers relatively concentrated. NC is farther south, has better potential for solar, and a climate that is somewhat milder in the winter and warmer in the summer (except for the mountains).
Both Sweden and NC see biomass as one of the few domestic energy resources that they might be able to develop significantly. NC is starting to do some things with this, Sweden may be a bit further along. Sweden is probably a bit farther along with wind. I don't know much about what Sweden has done with micro-hydro, NC definitely has potential to do a lot more with that.
Interestingly, Sweden has aparently made a very deliberate decision to turn their back on NG entirely in order to avoid becoming more dependent upon energy imports. A very radical decision, one I'm not sure that NC would be capable of making.
Energy efficiency and conservation, of course, needs to be the main event, though. Sweden is probably a lot farther along than NC in this regard, with more extensive investments in mass transit and passenger rail, and higher standards in building efficiency. One thing of particular interest is that they are placing very great interest in developing district heating systems, something hardly even seen in the US. That is one strategy we definitely should be copying.
And of course Sweden is a highly developed welfare state with a plethora of social democratic programs in place. Smart policies flow from well-educated, well-informed, well-housed and well people.
Let's see how sustainable those social policies are once perpetual growth becomes impossible. They will fold up just like Social Security and Medicare will in the U.S. Then it's back to taking care of yourself and family.
The Swedish right wing government is slowly downsizing varios government functions and the social programs are getting focused on helping weak people instead of buying everyones votes. The key strategy for getting this to work is creating more jobs by lowering taxes for poor people and lower middle class and it worked brilliantly up to the onset of the financial crisis and then it made the downslide slower during the crisis.
I am quite sure that this is the right direction for us to prepair for the post peak oil era but I do of course not know if we are moving at the right pace. Nobody knows how this will unfold but I am quite sure that we can move a lot quicker if it is needed.
I also expect that we will get some kind of boom during the downslope since we got a lot of the technology and production needed to make societies more efficient and we got an ability to produce more of it. We are or can be a net energy exporter in finished goods, biomass based products and electricity and that is a lot better then having a pile of gold.
One of the key factors for survining is if we can continue disassembling the parts of the socialistical experiments that dident work out and continue to build on our free market economy and honing the key government functions. Our large socialistical party is backpedaling on the bad parts and that is good but they are being slowed down by a cooperation with the former communists and they are quite scary since they dont agree to fiscal responsibility and the long term plan of paying of the state debt. It might work out ok for us since fiscal responsibility is an election winner.
Hi Magnus,
Tongue-in-cheek satire should be made clear so that the casual TOD view does not get the wrong idea.
I like funny wording but we have problems such as needless queues to often exellent hospital care.
I like the technical quality but the queueing system is broken and we got the man hour resources to fix it if people focused on the patients needs rather then the internal bueraucracy.
The part of the socialism that often works out ok is the ideas taken from christian roots, the worst part is that it is terrible for organizing complex work and getting stuff done where everybody needs to think about what they are doing and not only execute the top dogs plan.
The planning leadership is good for deciding to build major functions that are measurable like water distribution. It fails when the political leadership starts to plan the details and it can fail realy bad when deciding to centrally plan thinga that cannot be measured like how people should relate to each other wich our socialists tried to adjust by making a mess of our schools and control mass media.
We survived a crazy level of central planning by having a very rich society with strong institutions before the crazyness of the 1960:s and the terrible 1970:s. We could afford a lot of inefficiencies and it took many years to realy damage institutions like our scools. And almost all parties kept their basic trust in measurable scientifi truts, our scientists were not infallible but it were overall a good influence exept for politically correct social sciences, we still got way to much low quality genus "science" and old communist trying to create a conflict between males and females.
As I see it we are a partly broken society that has been trying to better itself for about 20 years and it has overall been a success. And we try to keep what were good even if it were created during a socialistical era.
Not in Sweden - they have to work as a society because of the harsh weather. A group of people who stand too alone will be wiped out physically.
Yes, NC is more than a few steps behind. We are in some respects a somewhat progressive state for the South, but we're no Sweden.
Plus, the Swedes are resourceful people, with major industries, and the highest patents per capita.
Not bad for a bunch of socialist commie pigs!
Plus, with all that good medical care and safety nets, they are the second tallest people on Earth, after the Dutch, which have the greatest equality of wealth, and hight number of Art galleries per capita.
Anyone notice a trend?
Yeah...but do they have nuclear bombs, like 10,000 of them? Do they have nuclear submarines, aircraft carriers, drones, B2 bombers, F117A stealth fighters, F-22 whatevers :) :)! We could just invade and bring democracy!
We are indeed military weak. Our army is downsized for mere fiscal reasons and we only have stuff like low cost and fuel efficient Gripen fighter jets sold with unfair lifetime cost guarantees and we also treathen to give the customers the source code to the systems they buy. Low cost and customer satisfaction is an outright provocation aganst F-35 motivating heavy use of US political might! ;-)
Yep most of the WWII neutrals did pretty well for themselves. Lets hope we don't have to see how well that will play out next time.
The trend in Sweden is to slowly acknowledge the secret cooperation with Nato during the cold war and the cooperation is now very good. I would not be at all surprised if we join Nato in a few years or a decade, on the other hand I dont know if Nato still exists in its current form in ten years.
That war is getting to be a long time gone and first hand memory of it is fading fast--that worries me far more than how any particular country gamed the edge of an awful tough situation. Quite a range in the future success of the neutrals when you compare Switzerland and Afghanistan today. But then those places weren't very equal in the forties either. Hard to say what will come of NATO, I'm not too sure its demise would benefit mankind much.
I'm being very sarcastic with my above comment. I know its only a TV show, but "Rick Steve's Europe" has shown me a lot of Europe and most of it is gorgeous. The US spends WAY too much money on warfare. Why we need all of this is beyond me. I would think a small nuclear arsenal would be more then enough to keep any invading country (Mexico? :)!) from enslaving us.
I thought the reason for our massive military machine was common knowledge--so we can keep burning up about one in four barrels of oil pumped worldwide a day. Years on end of enlightened policy making have sucked just about anyone who owns anything into dependence on keeping the big ball rolling.
Of course there is the other thing. It seems that throughout history if there wasn't one or two gorillas in the room some of the squabbles between the rest of the monkeys have tended to escalate into truly nasty fights. Even those with the greatest vision miss or underestimate critical elements and the importance of many, many interrelationships. Watch the swings of your own point of view through time and be amazed.
Wind is inching up to 2% of the Swedish electricity production and it can grow much more then micro hydro. Micro hydro will probably never get back to the production it had around 70 years ago, it were economically devastated by the regional grids and medium scale hydro and then the national grid and large scale hydro, nucelar and most if it is even more expensive then wind. But its a fun hobby!
The large investments are in cabliefying rural electricity lines, new regional power lines for wind power, reinvesting and enlarging the national grid, new biomass fueld CHP plants, more district heating and cooling, renovating 11 out of 12 nuclear power plants, renovating hydro powerplants and strenghtening dams and wind power. The sum of what has been done and what is planned between about 2005 and 2015 is roughly $50 billion and very few projects got delayed by the financial crisis. This gives me the impression that we can enter the post peak oil era with a very good grid, plenty of electrical power, almost fossil fuel free electricity production and space heating and a good momentum in all the support industries. It will be quite easy to power any number of EV:s or increase industrial production by 10% and we can export transformers, HVDC equipment, cabels, etc for at least ten and for some equipment a hundred times the population we got.
We are getting our first LNG import facility in Nynäshamn to provide a refinery with gas for hydrogen production and the old city gas network in Stockholm. It is fairly likeley that we will get a number of small LNG facilities for biogas back-up as a side market and fueling shipping as the main market. I guess it depends on how much the Norwegians etc wants to invest.
There is a gas pipeline along most of the west coast but the project to connect it to Norway to get gas when the Danish gas runs ut got postponed in the financial crisis. There were once a suggestion to import cheap natural gas to phase out nuclear power but today nobody believes natural gas will in cheap.
There are biogas investments all over the country and I would not be surprised if this adds up to a narrow gauge pipeline network within a few decades but it will only be used as a high value fuel for cars, lorries, tractors and industrial processes.
Magnus:
Thanks for filling in some details. I am particularly interested in hearing more about:
1) The extent to which various energy projects are private rather than public sector, and how the government nudged the private sector players in the desired direction?
and
2) How Sweden made district heating happen to such a large extent?
The most important tools are probably the CO2 taxes and the free electricity market, we did not get an Enron suck-people-dry, we got higher prices and lots of investments.
Most of the various energy projects are private sector or municipiality owned or governmnet owned Vattenfall. Almost all of the municipiality owned utilities are in the green economically but they often have a lot of debt from investments with long payback times.
The large penetration of district heating is due to about 50 years of investments and it has mostly been motivated by economical and environmental reasons. The pioneer projects were often oil fired and eased the labour shortage in the 1960:s by replacing small manual fired boilers and replacing hundreds of small coke and oil boilers with short shimneys with one large oil boiler with a high shimney made for a quick and very visible air quality improvement and it also saved fuel. This made district heating spread like wild fire among the large towns, nobody likes sooth.
This were fairly easy since almost all space heating were hot water systems and they are a lot cheaper to convert to district heating then steam systems.
We got the distric heating boom as we had a very large centrally planned build of flats that were the same kind of large "rational" projects built all across europe and large US cities. Our steam turbine industry quickly picked up on the trend and sold CHP plants that became a part of the civil defence. Most or perhaps all of the CHP plants from this era has abandoned oil caverns below them for 6 or 12 months of production.
Since the systems continued to make economical sense they continued to get enlarged. There were an investment boom during the 70:s oil crisis since the systems saves heating oil and boilers stared to be converted for coal. We had government subsidies and taxes to encourage coal use and abandon heating oil.
We almos got nuclear district heating in the 70:s but the anti nuclear movement were to strong. The effort to phase out nuclear power gave another boom for district heating in the 80:s and conversions to coal and biomass. We got governmnet taxes and subsidies to encourage biomassa and coal use. The pipe insulation technology developed and the systems becmae cheaper to build.
The our forestry industry and the climate issue started a conversion of the coal CHP systems to biomass in the 1990:s and we had a technology development of small scale district heating. But the biggest boom that soon is complete were large scale garbage incinerators. This development were hastened by the tax system and then an outright ban on land filling untreated biological waste. Almost all of the biological waste now goes to CHP plants, heat plants, biogas production or compost. Manny land fills are now closing down.
Lots of government regulation and we had long periods with schitzophrenic overalapping regulations that stalled the growth and scared investors. But the basic pipes, running of the systems and fuel were almost allways paid by the customers and they got a better deal then having their own boiler. Todays subsidies are more geard towards technology devlopment and a lot of the political effort is to get large scale slow payback investments done.
The main competitor to district heating is ground source heat pumps, then air source heat pumps and then wood pellets. The heating oil use is quickly becomming extinct since the taxes on oil are almost punitive, they have been raised since the 1970:s.
One key point is probably that we did not get the air quility improvement by building a natural gas distribution network. We had a focus on the cheap electricity and cheap oil instead and almost all of the old city gas systems were abandoned. Then we tried to abandoned oil as fast as we could after the 70:s oil crisis and we simply continued with the same kind of investments.
( Edited due to oops )
Magnus:
Thanks so much for the briefing, which unfortunately points out how very different Sweden and NC are.
Given the widespread installation of central forced air heating and cooling (something you probably have very little of in Sweden) in individual residential and commercial buildings, switching to district heating now would be a much more steep uphill struggle. The time to have started doing it was back in the 1940s, when a lot of people still had oil or coal fired boilers and radiators, and no a/c. Too late now, unfortunately. There might be a slight opening, however, for all of those heat pump systems that have been installed. I could envision a district heating system that would deliver heated water to heat exchangers in heat pump units, so they wouldn't have to suck heat out of the cold air. This would probably increase their energy efficiency dramatically. In the summertime perhaps the district plant could cool water from an underground pipe system, and run that through the district's heat pumps. That is about the only remotely feasible pathway I would see open for the development of district heating plants here in NC. It would very likely be considerably less expensive on a per-household basis than would the installation of geothermal heat pumps (which are a great technology but very expensive - too expensive for most people). The scale for these district plants would be just right to make good use of biomass + geothermal + CSP, which are all among the few energy resources that NC has available to develop.
We don't have CO2 taxes, and those would only be implemented at the national level, which is doubtful. We do have motor fuel taxes, however, and these could and should be raised substantially. The main problem is that we do have parts of the state (like Charlotte) that are very close to bordering states; if we raise them too high, that will just encourage people to drive to neighboring states to fill their tanks. That is a problem you don't have in Sweden except for a few settlements along the Norwegian border, I would suspect. That's the problem we have with so many things. Sweden is in a federation, too, with some hoops dictated from above that you must jump through, but you nevertheless still have far more autonomy to decide what is best for you and to act upon it than any US state does. The flip side of that is that we do get more secure supplies of NG, coal, and even oil than you can count upon. That is a mixed blessing in that we are less boxed in at the moment, but it also tends to reduce the incentive for prompt and serious action.
It might be fairly easy to convert central forced air heating and cooling to district heating and cooling. It would be a lot worse if you had individual units for every apartment or shop or even worse if you have lots of resistive electrical heating as we have in houses built in the 1970:s when nuclear electricity replaced a lot of heating oil.
The district cooling is often produced by absorbtion coolers, they have a COP below 1 using more heat then you get cooling but use little electricity and makes sense when you got excess capacity from garbage incinerators or industries selling waste heat during summertime. They also ought to be a good technology for powering cooling with solar heat collectors.
Norway has higher motor fuel taxes then Sweden. The main "leakage" in the wehicle fuel use are truckers from Poland and the Baltic countries that have large onboard tanks for their own diesel cosumption. Their lower wages and cheaper fuel makes competition tough for Swedish truckers.
Magnus, district heating, etc. looks good on paper, but in the US, where infrastructure is already failing, I don't see it in our future. Most cities are struggling trying to maintain old and failing water and sewer systems. Yet another utility to fund and build doesn't seem doable. We can't even build new rail systems or pass a socialized healthcare bill. It seems that folks in the EU are better at these things.
Rebuilding and upgrading dense cities ought to be a lot cheaper then the giant suburbia build. You ought to be able to do an enourmous improvement with 1/2 or 1/4 of the resources spent per year.
And you can do it with the best technology available. In my home town have we started to rip up the district heating pipes laid about 40 years ago since they have started to rust thru and the insulation is poor. They were a lot more expensive then todays piping that use far less steel and almost no concrete and seems to be able to last a lot longer. This is an investment that will be productive for more then 40 years, it wil still be usefull even if you invent fusion power! And you got cheaper manpower then we have, your cost per hour is more like our cost when builing cumbersome concrete culverts and man power intensive badly insulated steel clad pipe 40 years ago.
The athlete's village site for the 2010 Olympic Winter Games in Vancouver (opens Friday Feb 12th) uses waste heat from sewage in a district heating plant. Moreover, the entire village obtains a minimum of LEED Gold standard, with the community centre rated at Platimnum. The flats will be sold privately after the Olympics end in March. The project accounted for emissions only for construction and matierials, which will be more than compensated for over the decades as the 3,000+ residents of the neighbourhood attain perhaps the lowest emissions levels per capita in North America. Vancouver has already lowered its emissions by 11% over the last decade, while also experiencing 17% economic growth over the same period.
This development indicates what is possible for the 21st Century in the face of high energy prices and climate change.
http://forum.skyscraperpage.com/showthread.php?t=139393
http://www.vancouver2010.com/more-2010-information/sustainability/sustai...
How about district solar?
What I would envision is a district plant that combined geothermal with solar (either thermal panels or CSP) and a biomass burner/incinerator. The scale for such a plant is just right to make the capital cost per building served a lot lower than the capital cost of trying to put any of these into place for an individual building; economies of scale.
One of the good things with district heating is that you dont need to colocate the heat customers and different heat sources. You can have the biomass CHP close to the railroad, the heat pump that recovers heat from the sewage flow next to the sewage treatment plant, if you have geological hot zones you pipe in the warmth from them and you can use old oil or gas boilers as backup and peaking units wherever they are in the district heating area.
I find the articles about Vancouver's efforts to be "green" to be moderately amusing, but that's because I was born there. However, I only lived there for part of my first year because my mother informed my father that she was not going to spend one more winter there.
The problem is that, although it doesn't actually snow much there (bad news for the Olympics), it rains more or less continuously all winter. So I associate wintertime in Vancouver with with (green) moss growing on the buildings and (green) giant pacific slugs crawling through the (green) grass. Green means mold growing on everything.
Vancouver is much better off relying on British Columbia's massive hydroelectric potential. All that rainfall results in enormous amounts of water running down its steep mountains to the sea. Put dams on all the big rivers and you've got a lot of hydroelectricity.
But a photoelectric panel is not going to generate much electricity in the winter because it doesn't see much sun. I've got one on my sailboat there, but it only has to keep the batteries topped up while I'm away. When I'm there I rely on the diesel engine to recharge the batteries, and the diesel heater to keep the boat warm.
Quite a few of us who dwell in planing and urban design circles do find Vancouver's achievements quite remarkable because it resulted, essentially, from the stroke of the mayor's pen, and did not involve senior governments.
In a 10-year period the population of the downtown penninsula was allowed to double with high density development that brought a new vibrancy to the streets and that also opened up formerly industrialized waterfront land to the public. There was a concurrent 10% drop in downtown traffic. Apparently, people prefer to walk to work and nearby shops. Over 40% of the downtown population does not own cars.
This may be 'moderately amusing' to Europeans who take such things for granted, but it's unique in North American cities that largely evolved after the advent of 19th Century human-scaled urbanism stemming from streetcar suburbs.
Granted, the focus must now turn to the 70% of the city's less dense land base outside of the inner city, and that is what is happening at present. I am not convinced they've got it right yet, and there have been some inappropiate developments plunked down in neighbourhoods filled with (albeit expensive) single-family homes. But I'm confident we'll get there, and hope streetcars come back to stimulate more transit oriented development than that already seen with Metro Vancouver's fairly successful (but incomplete) rapid transit system.
Further, given that British Columbia has a premier whose legacy will be to reach unprecedented heights of hippocracy by claiming to be on track to reducing BC's GHG emissions by 33% by 2020 while simultaneously building a gigantic freeway network, and a prime minister who has consciously and puposefully buried Canada's chances of ever reducing emissions or addressing peak oil, and who has also buried the nation in debt from very questionable bailout policies, Vancouver city and the metropolitan government have demonstrated perfectly clearly that the most successful efforts will take place locally. This dovetails with Gail's very informative post the commentary string.
Globalization transcends to localization.
Lastly, it is true BC has enviable hydroelectric resources, but it comes with a cost on agricultural land which is scarce in BC. Moreover, the glaciers that feed most of the reservoirs are melting which will lead to a bit of a powerdown later this century. The latest hydro effort is with run-of-river, but it's also mired in controversy as some of the projects are truly huge and not at all at the smaller scale enviromentalists favour with little impact on primarily salmonid habitat. Wind power is just starting to take off. The offshore Naikun project is quite huge and has a lot of support from the Haida people ( http://www.naikun.ca/ ). But the most promising clean power source is possibly in the huge tidal rips between Vancouver Island and the mainland. No one one is currently developing this potential.
One very promising newly-discovered energy source is contained in the slime produced by slugs, of which, it was pointed out, BC has in great abundance. The chemical properties in the slime are similar to some components contained in gasoline with the exception that they are emission-free when catalyzed, ionized, then burned. We'll see hundreds of industrial slug farms before 2050.
Just kiddin, RockyMtnGuy.
Curious is there any attempt to utilize the rise and fall of the tide on floating stuctures likes docks which are tethered to fixed pilings? Seems something that could utilize this could be sandwiched into all floating platforms.
They could use the 20 foot tidal range to generate electricity, but as Salish alluded to, the 12-knot tidal rips running between Vancouver Island and the mainland are a much more viable source of power.
However, both pale beside the hydroelectric potential of all the big rivers running off the high mountains into the ocean. None of this is at a particularly cozy small scale, though.
I've just wondered if anyone has done anything on the up and down. The heavier the platform, the more flotation required, the greater the resistance that some sort of mechanical/hydraulic system could offer to the rise and fall of the platform, the bigger the turbine that could be pushed. The platforms are there anyway, and boat harbors use power. Of course the marine environment is so hostile to doodads, the systems would have to be very simple, with critical all complex components well protected. Probably just too hard to mess with.
Speaking of harbors, do you ever sail north well up the inside passage?
Late breaking news: Vancouver once again made #1 on the Economist Intelligent Unit's list of the most livable cities in the world. Calgary, where I lived for many years, was only #5. Seven of the top ten cities were either Canadian or Australian, which may have a lot to do with abundant natural resources and low population density, although they didn't actually say that.
Not that I'd live in any of those cities. I have much higher standards that are only achieved in the highest mountains of the most affluent countries. And Bhutan, of course, which excels on the Gross National Happiness scale.
But back to Vancouver. It's an interesting example showing that you don't have to have freeways to have a high standard of living. However, I think they could have done a better job on their rail transit system. There are railway tracks running everywhere through the urban area, and they could have dropped a couple of tracks into the right-of-way next to every freight railroad and blanketed the whole area with light rail transit. The SkyTrain is somewhat overbuilt for what it does and doesn't cover enough of the area.
Another thought, and one that will upset many residents, is that the city as currently built would not work without Alberta oil to supply the cars, trucks, trains and ships that keep it running. Vancouver is the only city I know of where more smog comes from ships in the harbor rather than cars on the freeway, but it's still very oil-dependent.
In many US cities (and even medium and small sized towns) there is a considerable amount of space occupied by the vacant and decaying ruins of the bygone industrial era. It would seem to me that these might be ideal sites for placement of district heating/cooling plants, especially those sites still surrounded by substantial numbers of occupied residential and commercial buildings.
First of all, it is the FedGov, and to some extent the State governments, that are most dysfunctional. Some city governments are as well, but many local governments are not that bad. Not perfect, maybe, but good enough.
District heating projects are inherently local, and should be. Get the FedGov involved and they are going to end up being four times as expensive and work out half as well.
The attractive thing about district heating (or actually heating/cooling in the US context, most likely), is that the potential energy savings per customer would be enough to cover the debt service on the capital investment plus operating costs, and still end up with a net savings for each customer. Even in today's environment, that is still promising.
What an amazing map, Nate, thanks!
Iran must be an absolute basketcase...and yes, offense intended to Alabamians.
Gross GDP is all well and good, but it's GDP per capita that really matters in terms of the wealth of a place. For example, California's numbers are more impressive when you consider that France has 62 million people, while Cali only has 36.7. Or Louisiana's 4.4 million versus Indonesia's 228 million, and the state is still poorer by many standards than many other states in the union.
Nice article gregor, but I think you should use per capita debt or debt/GDP rather than the one billion dollar mark to pick the states. There is a big difference between California borrowing a billion dollars and Vermont borrowing a billion.
A pretty short list would be a list of local, regional and national government entities in OECD countries which are not in some degree of financial trouble. It's a Grand Prix of Debt Race to the edge of the cliff.
Tom Whipple pointed out that oil production per person has started declining, according to official statistics. This decreasing production per person raises distributional issues, i.e. who gets how much of a shrinking pie share. Countries are in increased competition with countries, states with states, persons with persons. No future estimates of the date of annual total peak oil production needed.
Gregor - good stuff! This I see as the second major social issue - state employees enjoying the benefits of private sector enterprise while the private sector perishes.
I was surprised New York wasn't on the list. Where do we fit?
I live in NJ - and while I keep reading about the imminent demise of my state - life seems to go on pretty much as before. There were drastic budget cuts last year but frankly the state provides so many services and the budget so bloated it appears those cuts were made without much pain.
NJ historically (along with Connecticut) has the highest per capita income in the US - I live in a county with the 7th highest per capita income in the US and there are 4 NJ counties among the ten wealthiest counties in the US. Living here gives one a rather distorted view of life in the US. While unemployment is high and tax receipts are way down - one sees little evidence of municipal service cuts. The biggest worry and source of anxiety is the decline in housing value. The price of a simple Cape Cod style home in my town was well into the 400,000's a year ago - but has seriously declined.
Because of this affluence the state has over the years supported an extraordinary array of programs - providing benefits that have actually caused some groups to move here from other states to get those benefits (people with AIDS, children with disabilities etc).
Because there are so many services and state supports there is a lot of room for cuts before we don't get streets plowed. To give you an idea - in my town this year they they installed fancy new Victorian street lights, repaved all the main streets and installed non skid mats at all the curbs. They also put in a belgian brick curb along the length of my three mile long rural road to prevent erosion. We also got two new outdoor hockey rinks that use refrigeration to make ice and an new ATV trail. Given all the predictios of doom and gloom for the state I admit to being baffled as I watch all this spending going on- spending that seems in this environment rather frivolous to me.
I'd note also that the price of gas is lower in NJ than in neighboring states - usually about 25 to 40 cents a gallon. I have been told this is due to the presence of refineries in NJ ( NJ by law prohibits self service gas stations). Most electricity in the state is supplied by nuclear and is very expensive. Along with the highest property taxes in the nation we have the highest utility bills. While the collapse of the real estate development boom has hurt - it has given us a respite from the relentless suburbanization of the state and I have seen several new housing projects start up recently - a townhouse community and a few new single family homes.
Home rule is huge in this state and results in much higher costs for education administration and even things like 911 systems. Each small town runs their own show with the subsequent higher admin costs. When they finally do have to make deep cuts - significant amounts of money can be saved simply by creating regional school districts and making police and fire county based. The affluence in the state has so far prevented these sorts of economies. This will create lots of screeching but it allows economies to be created by not reducing essential services.
I do not dispute that NJ has serious problems economically - but one gets a different picture living here and given the way things are structured here there is enormous room for economies before we become a zombie state.
Here is the picture for New Jersey...
Very large and comfortable SUV, flying down the Highway with 1/4 tank of gas.
No one, stops to fuel it up, because no one has the money.
Large SUV continues down the Highway.
Large SUV runs out of gas, in the middle of a Blizzard and the occupants must walk to safety.
Occupants start shooting each other for food and clothing.
25% make it to safety.
No matter what way you look at it, the New Jersey Nets are beyond horrible :)!
MN/WI aren't any better. We have huge deficits, import all of our energy and the dairy industry has taken a big hit the past year. Changing the currency to cheddar cheese may benefit us.
The average house price in the county I live in was $821,000 in 2009, down from over a million in 2007. However, the town I live in is still in the 2007 range.
hightrekker,exactly correct. Prices for houses are "cheap"...until you actually start shopping for them. Try it folks, you will get a revealation.
RC
The CBO seems optimistic about our ability to pay taxes:
http://www.cbo.gov/
So they can spend like this:
They better be right about unemployment...:
...or States will be even worse off.
The first two graphs appear to be mistakenly shifted in time because tax revenue should not shoot up until 2011 after the Economic Growth and Tax Relief Reconciliation Act of 2001 expires on Dec. 31, 2010. The projected unemployment is ridiculous, as if Alt-A and Option ARM resets will not cause massive mortgage defaults in 2011, another financial crisis and rising unemployment. Perhaps they anticipate the long-term unemployed will drop out of the U-3 statistic. I wonder what the CBO is projecting for U-6?
. . .and they all lived happily ever after."
Thanks for the fairy tale.
Now, back to the real world. . .
very interesting post. look forward to the additional comments. Personally, i believed the first step down this ladder of reality would take us back to the 60"s. Now i believe it will be the 40's. Having lived during that period I can tell you it was a grand time, but this time it will be with a lot more folks. I live just north of the cody scarp, so much of the disruption that is taking place in our sand box will be to the south. but, many of them are already leaving the state and some are even moving into my neighborhood. Gardens are being planted in many areas, but mine is still the first front yard garden. State gov is struggling with its deficits and are likely to cut much needed assistance to poor old folks. Our moderate governor is a repub and is likely to be defeated by a Palin clone for the U.S. Senate because of the right wings hold on our ignorant citizens. If you are looking for a place to live put Fla at the bottom of your list. Losing population for the first time in decades, poor soils, hot climate, mosquitoes, snakes, alligators. and a shrinking very sick economy. While we have enjoyed your transfer payments in the past they don't look so secure in the future. Please consider this message as being from the Florida Chamber of Commerce. Cheers,
Florida is terrible, there is no real work down here. The coastal area is one non-stop strip mall from Key West to the Florida borders. In the mean time I'll be stuck here for a few more years so I can keep the Pythons and other invasive species company in the Everglades. Marco Rubio seems like a good candidate, I'll be voting for him.
I rest my case. If you believe Palin would make a good president you would love Rubio her favorite candidate.
I would not vote for Palin in an election for mosquito control.
Meek is a fool, http://www.ontheissues.org/FL/Kendrick_Meek.htm
Well then why would you vote for Rubio? Clear Channel Radio has linked them in any number of ways. Meek is indeed a weal candidate. But the field has not been yet determined. Personally I hope Rep. Alan Grayson will get in the race.
Because out of control spending via social entitlement programs and globalism has ruined this country.
yup, just what i thought. Let me guess, Beck at 9:00am. Rush at 12:00Pm. Hannity at 4:00 pm. Suggest you read some of the posts and comments on this site. The real "root cause" can be found here if you look for it very carefully.
I don't like any of those talking heads. I am not "Republican", I am a paleoconservative. The root cause of many issues is an entitlement mentality. The Democrats will not solve the problems on this site, nor will the Republicans. The Democrats sure are making the mess a whole lot worse though.
Never ending war in Iraq and Afghanistan and tax cuts to the wealthy have contributed to the out of control spending which, as a neocon, Marco Rubio (R-FL) supports. NO solution will be found as long as Americans vote for either side of the same coin.
floridian,
excuse me, i forgot you were the one who on Feb 5, 2010 on this site stated that "Only landed people should be able to vote." Now what exactly did you mean by that statement?
Land owners. I do not believe in Democracy for all, I like limited Republics.
Franz Kafka: "There is hope, but not for us."
That's cool, so long as land owners carry the entire tax burden!
If I'm being taxed, I want a say as to how my money is being spent.
And, if only their children go to war.
Gregor,
I don't see any data on state energy import/exports.
For instance, Illinois exports coal, electricity (about half nuclear, about half from coal), ethanol and food commodities, while it imports oil and natural gas. Actual numbers would help us know: what's the overall balance of trade??
Hi Gail.
I attended a panel discussion last November at USC on the future of California's budget. Among the panelists was Bernard Parks, the former LA Police Chief, who is now a Los Angeles City Councilmen. He had the following heart-warming comments:
This year (09-10), the total pension for LA’s police and fire department (shared pension fund) was 80% of their combined operational budget or $1.35 Billion. (Police $1.189 Billion + Fire: $0.497 = 1.697 Billion) See
http://budget.lacity.org/pdf/Budget_Summary_FY09-10%20WEB.pdf
For the 2010-2011 FY, the pension for the same groups will be 120% or more of their operational budget and they have no idea of how to fund it. He said this problem is indicative of a systemic demographic problem that the all of California faces. The healthcare and retirement funds of those retired and about to retire cannot be paid by the taxes from the 20 something’s who are working in entry level, part-time service sector jobs. As the population ages, this is going to be a problem for many more states.
-Pragmatic
We are headed toward something akin to a civil war--between taxpayers and current/retired civil servants.
Did they not make the pension contributions that they should have made when the employees were working? That is pretty basic, and if they were so foolish as to not do that, I have trouble having much sympathy.
100th post in this string, at the time of my posting, and for the 100th time I will ask those who use the amount of net energy imported as a sure harbinger of doom to look at some of America's competitors...Japan, North Korea, Germany, Sweden, The Netherlands, Denmark all come to mind, all nations surviving year on year, decade on decade to this point with almost 100% net energy imports.
If percent of net energy import is sure to bring collapse, one wonders how many of our European and Asian trading partners will have a hope of survival...and do you want to talk pension costs per person in the U.S. compared to these nations?...Euro, R.I.P.
RC
Yes, mate but being post Peak supply is the issue:
a combination of who is able to make growth with highest price of oil and who are the oil exporting countries more afraid of.
So at this point in the game net energy import is the prime factor likely to induce stress.
In terms of per capita net imports, Israel and Japan are #1 and #2, well ahead of the US (#6). Greece and Spain made the top 5. The rest of the EU falls behind the US (per capita):
http://www.nationmaster.com/graph/ene_oil_imp_net_percap-oil-imports-net...
Ghung,
Yes, but there are some other aspects that this chart may not show...first, many Euro nations import less because they use less, but what they do use must all come from imports, they have no home production.
Secondly, the effect of transportation: The U.S. uses almost all oil it imports for transport, meaning that it is difficult to substitute. Many Euro nations, beside the oil they import also import a large percentage of natural gas (not shown in this chart) and are further along the path to natural gas and LP substitution even in transportation.
The U.S. is still a considerable producer of oil, and we produce most of the natural gas we use (with Canadian gas being the next biggest provider to us). Would anyone in the U.S. want to change places with Euro nations that must import almost all of their oil PLUS be relient on Russia for virtually all natural gas?
RC
I considered that RC. Despite all of our domestic production we're still near the top. This just highlights our vulgar level of consumption.
The U.S. uses almost all oil it imports for transport, meaning that it is difficult to substitute.
It's very easy to substitute: carpooling in the short term, hybrids in the medium term, extended range EVs (like the Volt) in the longer term.
Gail,
I'm not sure if your argument for Texas holds water. If their energy production perfectly matches their consumption, then the net economic value ought to be zero, no? While this means they aren't operating at an energy deficit, and so not as bad off as, say, Florida or Ohio, it also means that they aren't exporting enough energy to counteract their financial deficits. Texans borrow a great deal of money to sustain their high consumption levels.
In order to counteract the amount of money a state and its people (sorry..."consumers") must borrow to maintain a given standard of living, it must export more produce, or earn more returns from investment, then it spends on energy imports. In the case of Texas, one could argue that this may be offset by its agricultural, high-tech, and manufactured exports.
So while Texas doesn't have it as bad as some other states, the fact that it's in an equilibrium of net energy produced versus its imports doesn't bode well for the state, as much of its wealth is derived from the past vibrancy of its energy, agriculture, and manufactured exports. The fact that its own internal consumption is outpacing its exports may limit the ability of the state to borrow in the future to invest in future growth.
It's a great pleasure to have a piece posted at TOD, because the commentary is such high quality. Thanks to all for reading. I have made notes on all your suggestions.
Regards.
Gregor