Drumbeat: April 17, 2013

To Reinvigorate Production, Alaska Grants a Tax Break to Oil Companies

Hoping to reverse two decades of declining oil production in Alaska, the State Legislature in Juneau has granted oil companies an estimated $750 million in annual tax relief to increase investment in the giant North Slope oil field.

The tax change, approved on Sunday, was a major victory for Exxon Mobil, ConocoPhillips and BP, which had lobbied for years to repeal a tax system put in place by former Gov. Sarah Palin in 2007 that made state oil taxes among the highest in the nation. The companies have long claimed that high operating costs and taxes in Alaska encouraged them to move their investment dollars to other states with lower tax rates, like Texas and North Dakota, where oil and gas exploration and production have been booming in new shale fields.

WTI Crude Trades Near Four-Month Low Before Supply Data

West Texas Intermediate fell for the fourth time in five days, trading near the lowest level in almost four months before government data forecast to show U.S. crude inventories rose last week.

WTI dropped as much as 1 percent. An Energy Department report today may show crude supplies rose 1.2 million barrels to the highest level in 22 years, according to a Bloomberg survey. That’s contrary to a report yesterday from the American Petroleum Institute, which showed stockpiles slid 6.7 million barrels last week, the most since the seven days ended Dec. 28.

OPEC Crude Basket Ends Longest-Ever Stretch Above $100 a Barrel

The average price of benchmark OPEC crudes ended its longest run above $100 a barrel after dropping below that level for the first time since July amid signs the global economic recovery is faltering.

The so-called OPEC basket, a weighted average of the main grades produced by the Organization of Petroleum Exporting Countries, slipped to $98.56 a barrel yesterday, according to an e-mail today from the group’s Vienna-based secretariat. It’s the first time OPEC’s reference price slipped below $100 since July 16 and ends an unprecedented 191-day spell above that threshold.

US Crude Oil Production Sets Record in 2012

While advocates of solar, wind and other “Green” energy some are saying that renewable energy is the future, technological advances in the Oil and Gas industries will lead to abundant supplies well into the future, I have been saying for years that Peak Oil is a myth, it is.

US Crude Oil production rose by an average of 790,000 BPD in Y 2012, the largest annual increase in American oil production since it began in Y 1859.

This year the Energy Information Administration EIA expects production to rise by 815,000 BPD, setting another record.

Stuart Staniford: Monthly Oil Supply Update

Time for the monthly update on global oil supply in which I summarize the numbers for global oil production from the various oil agencies into a small set of convenient charts. This is for the benefit of those of us who like to do micro-tracking of peak-oil related issues. This month, I have made one charting innovation. The above graph shows global oil production since 2002 to give the full period of the "bumpy plateau" that started about the beginning of 2005. I have now added to this a green line (C&C (EIA)), which shows just the "Crude & Condensate" numbers from the EIA. This eliminates biofuels, natural gas liquids, and refinery gains from the picture, and is a more purist definition of oil. Which is better to consider is a matter of debate, but now we don't have to choose - we can see both at a glance.

The big picture is that the bumpy plateau slopes upward in both sets of data (ie anyone claiming peak monthly oil production was in 2005 or 2008 is not paying attention to the data). However, the "all liquids" line slopes up more than "C&C", because the natural gas liquids and biofuels have grown quite a bit.

What Gulf must do to join shale revolution

Where there are oilfields, there are bound to be rich shale resources like those that have ignited a boom in jobs and industry in North America, say oil executives.

But the Arabian Gulf needs to pave the way for that kind of challenging development with more infrastructure if it wants to become an attractive prospect for the likes of ExxonMobil, a representative from the company said yesterday in Dubai.

Natural gas industry to develop fast in China, says expert

HOUSTON (Xinhua) -- Liquefied natural gas (LNG) industry will see promising development both in China and other countries as natural gas is the only clean energy compared with oil and coal, a Chinese energy expert said Tuesday on the sidelines of a professional conference in Houston.

Of the three most important energy resources, both coal and oil have met their development bottleneck, but natural gas has great potential, said Wang Ye, deputy chairman of China LNG Association, who is heading a 100-plus Chinese delegation to the 17th International Conference and Exhibition on LNG.

How Cheniere Energy Is Leading America's LNG Export Revolution

If you want to see what the natural gas revolution in America has wrought, there’s no better place than the Sabine Pass liquefied natural gas port in coastal Louisiana. There you can peer into five massive storage tanks, each almost big enough to contain Madison Square Garden. Taken together, they can hold the liquefied equivalent of 17 billion cubic feet of natural gas–a quarter of what the United States uses in a day.

They’re empty.

Built in 2008 by Houston-based Cheniere Energy when it appeared certain that the U.S. would soon run short on natural gas and need imports to make ends meet, they ran headlong into the Great American Gas Boom. Drillers in recent years have unlocked so much gas from tight rock that America now enjoys record gas supplies and prices that are just one-quarter of what buyers in Europe and Asia pay. Projections are that the annual U.S. gas supply could grow a further 25% by 2035.

OPEC Said to Consider Saudi Arabian for Research Head Job

Saudi Arabia, the world’s largest oil exporter, has put forward a candidate to replace Hasan Qabazard as head of research at OPEC, according to two people with knowledge of the matter.

The nominee, along with any others proposed by fellow members of the 12-nation Organization of Petroleum Exporting Countries, will be discussed at an OPEC board of governors meeting scheduled for May 6 to May 7, they said, declining to be identified because Qabazard’s departure hasn’t been publicly announced. Two other people with knowledge of the matter also said that the producer group is looking for a new head of research, speaking on condition of anonymity.

Shell Shut Out as Africa’s Gas Trove Lures Asian States

Asian state-owned oil companies are making inroads in the contest for East Africa’s energy reserves, gaining power in export projects that Western explorers like Royal Dutch Shell Plc used to dominate.

Fields off Mozambique’s Indian Ocean coast are estimated to hold enough gas to meet global demand for two years, a prize that persuaded state-owned China National Petroleum Corp. to make its biggest foreign investment. The Beijing-based company agreed to pay Italy’s Eni SpA $4.2 billion last month for a share in the fields and a planned liquefied natural gas plant. While it’s the first time Asia’s state producers have participated in an African LNG project, companies from China, India, South Korea and Thailand now hold 24 percent.

Arcadia Said to Shut Dubai, Switzerland Offices Amid CEO Change

Arcadia, the energy trader owned by billionaire John Fredriksen, is shutting its offices in Dubai and Switzerland, said three people with knowledge of the plans.

Some staff from the Swiss office in Nyon will be relocated to London and Singapore, according to the people, who asked not to be identified because they aren’t authorized to speak to the media. Arcadia has appointed Paul Adams as chief executive officer, replacing Peter Bosworth, the people said. Reuters reported Bosworth’s departure on March 28. Nobody responded to four phone calls and three e-mails to Arcadia’s London office or three calls to officials in Singapore.

Can Iraq meet its oil potential?

The debate over whether the Iraq War was really all about oil may never be fully resolved in some minds, but one thing is clear – either way, Iraq has yet to really cash in. The country’s GDP may have risen several fold in the decade since the war began, yet its income per capita lags not only oil rich neighbors such as Kuwait and Saudi Arabia, but also relative economic minnows including Botswana, Turkmenistan and Albania. This is despite the fact that it sits upon the world’s fourth largest oil reserves and could double its production in the next few years.

The question, then, is will Iraq be able to meet its oil potential?

Minister: Iran to Celebrate Independence in Oil Sector Soon

TEHRAN (FNA)- Iranian Oil Minister Rostam Qassemi played down the effects of the western sanctions on the country's oil sector, and said Iran will celebrate independence of its oil industry soon in future.

"We were strongly dependent in the oil industry in the past due to a lack of control over technologies," but after hard work by Iranian experts and due to the pressures felt by the western sanctions we have come to a point that "we will celebrate independence in this (oil) sector in the near future", Qassemi said in Tehran on Wednesday.

Boston bombs were pressure cookers filled with metal

The use of pressure cookers as an improvised explosive device is a technique commonly taught in Afghan terrorist training camps, according to a 2003 bulletin by the Department of Homeland Security (DHS).

Europe Car Sales Heading for 20-Year Low on German Slide

European car sales are sliding to a 20-year low after German concerns over the debt crisis sent demand plunging last month in the region’s biggest economy and removed the main buffer protecting automakers.

Tesla shares get a jolt

Talk about electrified.

Shares of electric car maker Tesla spiked 6% Tuesday, nearly hitting a new high, on heavy trading volume.

Tesla generated a lot of buzz last month after CEO Elon Musk tweeted about a game changing announcement.

Is Armageddon on the cyber horizon?

So much critical infrastructure is vulnerable. Oil pipelines can be turned off and the pressure in nuclear plants turned up. Hackers can use any number of entry points to breach IT systems and, once inside, can access servers, databases and operational equipment.

More recently, a diplomatic time bomb was uncovered, which illustrates how cunning this activity has become. Dubbed Red October, this subterranean stalker has been stealthily stealing emails and other encrypted classified documents from diplomats for about five years. It has infected at least 350 government organisations around the world, especially in the former Soviet republics.

A Fight in Colorado Over Uranium Mines

Despite bursts of activity from 2003 through 2008, most uranium mines scattered across Colorado have largely been out of production for decades, a testament to fluctuating mineral prices. Now the future of these mines is at the crux of a dispute that could set a precedent for how they are handled.

Environmental groups in Colorado contend that many of the state’s 33 uranium mines should be forced to clean up, given that uranium mining, which flourished here during the cold war, has gone dormant. In legal filings, they have alleged that companies like Cotter are skirting potential costs associated with cleanup, which is required by the state after an operation shuts down.

China trounces U.S. in green energy investments

China retook its top spot as global leader in the clean energy race, attracting nearly twice the green energy investment dollars last year as the United States did.

Investors plowed $65 billion into Chinese wind farms, solar panel arrays and other clean energy projects in 2012, a 20% increase over the year prior, according to a report released Wednesday by Pew Charitable Trusts and Bloomberg New Energy Finance. The numbers reflect only private investments in power projects, and do not include government subsidies or R&D money.

LDK Delinquency Flags Chance of Another China Solar Bust

LDK Solar Ltd.’s failure to fully pay notes this week has raised the prospect of China’s second solar-industry failure this year as the company needs to repay a loan 10 times larger by June.

The world’s second-biggest maker of wafers that convert sunlight into power couldn’t repay all of the $23.8 million of dollar-denominated convertible bonds that matured on April 15, according to a company statement yesterday. Before the delinquency, its 2014 yuan notes dropped below 50 yuan per 100 yuan face value, according to data compiled by Bloomberg. The yield reached a six-month high of 125 percent last week, compared with the 79 percent for Bonn-based Solarworld AG.

Dubai coal power plant faces hurdles

Dubai's hopes of launching an environmentally friendly coal power plant is "a really good opportunity" but faces tall hurdles, said a specialist in the field.

For at least four years Dubai Electricity & Water Authority (Dewa) has studied plans to build a massive coal-burning power plant whose emissions would be pumped under the ground, providing the emirate as much as 3 gigawatts of energy without polluting the air.

InsideClimate News wins Pulitzer

“We try to fill in the gaps that exist in American journalism that are more and more common,” said David Sassoon, the site’s founder and publisher.

In the case of “The Dilbit Disaster: Inside the Biggest Oil Spill You’ve Never Heard Of,” it meant a seven-month investigation that found that the rupture of a pipeline carrying diluted bitumen from Canada’s oil sands region resulted in the largest onshore oil spill in U.S. history.

Sassoon said the reporters who ended up pursuing the story — Lisa Song, Elizabeth McGowan and David Hasemyer — were prompted to pursue it because Americans were wondering what would happen if the proposed Keystone XL pipeline extension would leak oil into Nebraska’s Ogallala Aquifer.

A Pulitzer Prize, but Without a Newsroom to Put It In

InsideClimate News may be the leanest news start-up ever to be presented with a Pulitzer, journalism’s highest honor, a prize that is typically awarded to regional and national newspapers. It beat out 50 other entrants and two finalists, The Boston Globe and The Washington Post, for the prize.

With a full-time staff of just seven and a nonprofit business model, InsideClimate News exemplifies a new breed of news organization that depends on donations, both from rich charitable foundations and a handful of ordinary readers.

Report on U.S. Meat Sounds Alarm on Resistant Bacteria

More than half of samples of ground turkey, pork chops and ground beef collected from supermarkets for testing by the federal government contained a bacteria resistant to antibiotics, according to a new report highlighting the findings.

Relief for a Parched Delta

Mr. Muñoz last saw a dolphin as a teenager in 1963, the year the last of the big Colorado dams, the Glen Canyon, began impounding water 700 miles upstream. “The river doesn’t come here anymore,” he said.

But after decades of dismay in Mexico over the state of the delta, there is reason for some optimism. An amendment to a seven-decades-old treaty between the United States and Mexico, called Minute 319, will send water down the river once again and support efforts to restore native habitat and attract local and migratory wildlife.

Q&A: A Look at Flood Maps and What They Mean in New Jersey

Earlier in April, the federal government announced that it would not give grants to repair homes badly damaged by Superstorm Sandy unless the owners agreed to make sure they are in compliance with new advisory flood maps.

In New Jersey, the policy will not change much because the state government has already said that it will not approve rebuilding the most damaged homes unless they comply with the maps.

Following is a look, in question-and-answer form, at what the flood maps mean to homeowners in coastal areas.

Accord Would Regulate Fishing in Arctic Waters

MOSCOW — It was once protected by ice. Now regulation will have to do the work.

The governments of the five countries with coastline on the Arctic have concluded that enough of the polar ice cap now melts regularly in the summertime that an agreement regulating commercial fishing near the North Pole is warranted.

U.S. Republican to bring carbon-tax message to Ottawa

Bob Inglis is a rare breed – a U.S. Republican who takes seriously the risk of catastrophic climate change and proposes a carbon tax as the most "conservative" way to address it.

The former South Carolina congressman lost a nomination battle in 2010 after acknowledging the threat of climate change. He is now stumping the U.S., preaching the merits of the carbon tax to young Republicans.

Carbon tax inflation is not the answer to Alberta’s issues

There was a time, not long ago, when governments offered massive subsidies and invested huge sums of public money to spur the development of Alberta’s oil sands. It’s good that many of these subsidies have been phased out, but it still costs more to produce a barrel of oil from the oil sands, than from conventional sources, which makes the Alberta government’s push to increase the cost of doing business in the province a troubling proposition.

Joe Oliver beats back accusations of climate change denial

Joe Oliver fought off accusations that he doesn't believe in the science of climate change at a testy meeting of the federal natural resources committee Tuesday.

The natural resources minister defended comments he made to an editorial board meeting of the Montreal daily La Presse in which he mused about the complexity of climate science.

"I believe and the government believes it's [climate change] a serious issue and we're going to continue to act on that belief going forward," Oliver explained after the meeting.

Climate change negotiations painfully slow: PM

New Delhi (IANS) Expressing concern over the slow progress of climate change negotiations, Prime Minister Manmohan Singh Wednesday said the goal of stabilising global temperatures at acceptable levels is nowhere in sight.

Speaking at the inauguration of the Fourth Clean Energy Ministerial here, Manmohan Singh said countries should take action to promote clean energy, and added that India recognises the importance of evolving a low carbon strategy for inclusive and sustainable growth and will double renewable energy capacity by 2017.

Carbon Falls Most Ever After EU Parliament Rejects Fix

European carbon permits declined by the most on record to an unprecedented low after lawmakers rejected an emergency plan to address a surplus of allowances.

Carbon for December fell as much as 45 percent to 2.63 euros a metric ton on the ICE Futures Europe exchange in London, and German power prices for next year dropped to the lowest since at least 2007. Ireland, which holds the European Union presidency, vowed to continue talks on the plan after the bloc’s Parliament sent the draft back to its environment panel.

Australia to Cut Carbon-Revenue Forecast as EU Price Plunges

Australia will lower its expected revenue from selling carbon allowances after the European Union, its partner in a cap-and-trade system set to start in 2015, failed to win support for lifting record low prices.

European carbon permits fell the most on record following a vote yesterday in Strasbourg, France, to reject an emergency measure to reduce surplus allowances. Carbon for December fell 35 percent to 3.09 euros ($4.07) a metric ton on the ICE Futures Europe exchange, the lowest-ever settlement for the contract.

Climate scientists struggle to explain warming slowdown

OSLO (Reuters) - Scientists are struggling to explain a slowdown in climate change that has exposed gaps in their understanding and defies a rise in global greenhouse gas emissions.

Often focused on century-long trends, most climate models failed to predict that the temperature rise would slow, starting around 2000. Scientists are now intent on figuring out the causes and determining whether the respite will be brief or a more lasting phenomenon.

How Science Can Predict Where You Stand on Keystone XL

This article is about the emotionally charged dispute between climate activists and environmental moderates, despite their common acceptance of the science of climate change. Why does this sort of rift exist on so many issues dividing the center from the left? And what can we actually say about which side is, you know, right?

Atmosphere ‘used like an open sewer’

“The world as a whole is putting 90m tonnes of global warming pollution into the atmosphere every day as if it is an open sewer,” Mr Gore said on the second and final day of the conference, co-hosted by the Government and the Mary Robinson Foundation.

“The accumulation of this man-made global warming pollution now traps as much extra energy in the atmosphere each day than would be released by 400,000 Hiroshima atomic bombs,” Mr Gore said.

EPA Report: Greenhouse Gas Emissions Down from 2010-2011

According to a government press release, the United States Environmental Protection Agency (EPA) has released a new annual report on greenhouse gas emissions to the United Nations. It concludes that the U.S. saw a 1.6 percent decline in greenhouse gas emissions between 2010 and 2011. Additionally, greenhouse gases have decreased by approximately 7 percent from the 2005 levels.

Clean energy progress too slow to limit global warming - report

LONDON (Reuters) - The development of low-carbon energy is progressing too slowly to limit global warming, the International Energy Agency (IEA) said on Wednesday.

With power generation still dominated by coal and governments failing to increase investment in clean energy, top climate scientists have said that the target of keeping the global temperature rise to less than 2 degrees Celsius this century is slipping out of reach.

"The drive to clean up the world's energy system has stalled," said Maria van der Hoeven, the IEA's executive director, at the launch of the agency's report on clean energy progress.

The new Bakken Data came out yesterday. Bakken production was up 41,580 barrels per day from January but only up 10,178 bp/d from December.

Jim Hansen posted me this:
From the Directors cut. The number of wells waiting on completion is down from over 400 to 375. That accounts for a good piece of the well completed last month.

February weather was more normal with no major storms or extreme temperatures and wind chills. Even though the drilling rig count dropped slightly; the number of well completions doubled to 170. That number of completions is well above the threshold needed to maintain production so oil production rate rose sharply, up 5.6% from January. Operators continue to keep the brakes on, pushing for higher efficiency and cost cutting measures. Uncertainty surrounding future federal policies on taxation and hydraulic fracturing remains. Over 95% of drilling still targets the Bakken and Three Forks formations.

Wells waiting for completion are wells that have been drilled and are waiting to be fracked.

Here is a graph of Bakken production in bp/d with one trend line showing the trend from July 2011 to October 2012 and a second trend line beginning in October 2012 to February 2013. The Bakken surge began in July 2011.
Bakken BP/D photo BakkenBPperD_zps02578847.jpg

Ron P.

barring further data points going up ( into the future ) I see a peak there - or do my aged eyes deceive me ?

never to get to 800KBd ?

I think if that is so then the decline side will be fun - factor in the drop in oil prices , if sustained , will cause a drop in rig count as well - not worth drilling new plays but the need by Wall Street to see reserves pushed ( until theres no money )

are we heading for a inflection of events ?

Maybe I'll see a sharks fin curve at last.


Possible, but we won't know until we have more data.

They had some severe snowstorms up in North Dakota last week. That might slow things down a tad.

To further the work of dcoyne78 who analyzed possible production profiles of the Bakken (contained in the post by Heading Out entitled "Techtalk - Future Bakken Production and Hydrofracking" found here http://www.theoildrum.com/node/9821), I analyzed the medium scenario on his figure (I tried to copy the figure into this post, but was unsuccessful). This production profile for the medium scenario shows Bakken production increasing to about 1.2 MMbbl/day in 2017 and 2018 and decreasing after that down to 0.4 MMbbl/day in 2023. The area under that production curve shows that the production profile would result in about 5 billion barrels of oil produced from the Bakken through 2040.

However, EIA estimates that there will be 3.6 billion barrels of recoverable oil from the Bakken. If we trust the EIA projection, then the medium prodction profile in dcoyne78's figure is too optimistic on total production from the Bakken (I am not criticizing dcoyne78's great work, just trying to add additional perspective on this issue). Either the peak is too high, or the decline is not steep enough. I guess that time will tell...


Thanks for the compliments, and I welcome the criticism.

Regarding the EIA estimate of 3.6 Gb URR from the Bakken, the North Dakota DMR Oil and gas division estimates proven reserves of 7 Gb, probable at 10 Gb, and possible at 15 Gb see the Recent presentations link at the NDDMROGD, presentation link "NDOGCPC10182012.pdf" slide 9.

I think these estimates are optimistic, a lot depends on oil prices, if we stay on a plateau ( my expectation ) and the economy does not crash (my hope), then I think oil prices may double in 7-9 years. If that guess is correct then the medium scenario may be a good guess, but only if the "average well" has a cumulative output which decreases by 1 % per month starting in 2013.

To be clear about this, wells starting production in Jan 2013 are assumed to have a cumulative output after 5 years of 178 kb, those starting in Feb 2013 will have a cumulative output after 5 years of 178*.99=176 kb and so on. This guess may be too optimistic, it amounts to a 13 % decrease in well productivity each year. By Jan 2018 the 5 year cumulative (in Dec 2023) is 55 % of wells starting production 5 years earlier.

In addition the number of new wells drilled may increase more quickly or more slowly than my guess and more total wells or fewer may be drilled overall.

Note that the second chart showing only the medium scenario is the better scenario from the link you posted above. I will post more some time at my blog

peak oil climate and sustainability


This chart is the one I am referring to, lets call it model 1:


An updated model, model 2 (avg well profile somewhat lower, otherwise the same) is below:


Average well profile of newer model


In the post above I mistakenly used the above profile in my description, the 60 month cumulative for model 1 is 191 kb, for model 2 (lower peak) the 60 month cumulative is 178 kb. At 360 months model 1 is 375 kb cumulative and model 2 is 227 kb for the respective average well profiles. Cumulative output for second model is 3.75 GB from 2005 to 2053.


Another difference between model 1 and 2 is model 1 reaches 24000 wells and model 2 about 21000 wells. The ramp up to 20000 wells is similar for each model (approx by mid 2018).



Nice work as usual. Thanks.

Hopefully the e-mail address in your profile here is up to date, I wanted to ask a question about figure 1. If not could you contact me at my gmail account or on my blog?


I could see a lower but better peak around september 2010 and guess others could tell more. How much more area is left to drill and I also read something they start to put more wells in between.


According to presentations found at NDIC oil website there is a 15000 sq mile Bakken area in ND to be drilled.

Plans are for 4 wells/ sq mi which would yield 60,000 wells, but some areas will have more or less than this.

The NDIC is expecting 45,000 wells which would be 3 wells/ sq mi on average. About 5000 wells are currently producing so even at 1 well/sq mi there are 10,000 sq mi which have not been drilled, no doubt the prospects of profitability are much lower in these areas.

It is likely that the more successful areas will be drilled more intensively (I have seen mention of higher wells per sq mi, possibly 12).


Thanks for your latest heads-up on these New American 'Saudi Arabia'-plays ....
These latest shale-oil news must be 'a crude awakening' for some previously playful shale-play-players - to use a well-known phrase.

A couple of articles on shale plays that have been previously posted caught my attention. I thought that the Heath Shale Play story was particularly interesting. Something to keep in mine when we read about the latest multibillion barrel projections for various shale/tight plays.

Chesapeake Drills Unsuccessful Wells in Southwest ND


Shale formation in Montana frustrates oil drillers


Good - and sobering video/articles. Bakken is obviously shrinking as we speak...

from the second one

Bell Creek has been producing oil since the 1960s and has been flooded with water in previous secondary recovery attempts. But Alegria said Denbury officials believe by using CO2, they can coax 30 million barrels of crude out of the field over the next 20 to 30 years

Part of the sober_up here is that all this effort over 30 years - is only equivalent to 2 days worth of US consumption ..... but at what level of pollution and low EROEI? Jezz..

*** I know that even after the Stone-age ended and morphed into the Bronze-age, someone still continued to collect stones ... for some time ....

Bring me back ROCKMAN, I have a question.

These CO2 driven wells the article mention briefly, how do they work? Is it just a matter of increasing pressure, or does the gas "lubricate" the oil so it flows better?


We may be nearing a ND Bakken peak, or not. I thought that the Bakken was near a peak in March 2011, but I was wrong. It is certainly possible that the current pause is similar to the period from Nov 2010 to May 2011 or the peak may occur soon.

If there is not a significant increase in output by July 2013, we may have our answer, my medium scenario predicts 783 kb/d, I would guess we will see between 750 to 820 kb/d in July 2013.

From China trounces U.S. in green energy investments, above:

In the United States, green energy investments last year plummeted 37% to $35.6 billion, although the country still came in second worldwide.

As the saying goes; "Nobody remembers second place".

An item on First Quarter 2013 car sales in China:


This stat caught my attention:

The big winners during the quarter were Chang’an, up 121 percent, Great Wall, up 53.2 percent and Geely and BYD , both of which increased by about 25 percent. In terms of models, the SUV segment outpaced the overall market, with first-quarter sales up 40 percent. Sales of low-end SUVs rose 47 percent, due in large part to new model launches.

Best hopes that they bankrupt themselves with SUVs so that they can't afford their genocidal lust for elephant and rhino tusks, shark fins, and other endangered species.

Let's don't forget bear and tiger gall bladders...

Wow. And some people think China's oil consumption is going to flatten out? Do they think people are just buying those cars to sit in their garages and not be driven? I can see them doing that with real estate but not cars.

And despite generous incentives, EVs have flopped badly in China. I suspect they have the same issue that cars have in Europe . . . people don't own single family homes so they don't have a consistent assigned parking spot where they can easily install a charger. And many people commute to work on public transportation such that the car is for longer distance and weekend traveling such that EVs do not appeal. EVs are best for commuter vehicles (short range every day driving).

EVs have flopped badly in China

They've taken a different form: E-bikes are outselling ICE vehicles.

Based on my own anecdotal observations while travelling in China, I'm guessing that many Chinese purchasers of e-bikes are people moving to them in place of walking or pedal-power bicycles, so they may still represent a net increase in energy usage. Many seem to be ridden by young people not yet in a position careerwise to buy a car, or people of very modest means, for whom an e-bike represents a big upgrade in convenience from what they had before.

I agree.

Still, they're Electric Vehicles, and they're selling in larger volumes than ICE vehicles.

EVs require energy, but they're synergistic with renewables, especially wind power. Wind power (and nuclear) needs more demand at night, and battery charging can also be timed for periods of high wind output, at night or otherwise.

then there is the food calorie saved component (which has to be run all the way up through to the land/energy consumed to point of delivery level) to factor in, though given current global obesity trends that might not be such a straight up calculation...of course extra distance is likely travelled on e-bikes which likely adds speed to additional segments of the economy the impact of which would also have to factored in...quite the web is it not?

Yeah, it's complex.

Not to mention the effect of additional injuries - apparently traffic rules are a quaint, western idea that hasn't sunk in for these riders...

Which means yet another impediment to electric car production since the lithium batteries in laptops and electric bicycles use a larger fraction of available lithium. Last month, Chinese car production exceeded a projected 24 million units a year. The 2 issues stopping EV car/heavy motor production on a large scale is mass production of batteries with energy capacities similar to what a gasoline or diesel tank has, as well as copper wiring for electric motors.

I believe Tesla is getting about 2 horsepower per pound of motor weight (that includes casing - not just windings) - with their controllers and control programming they're running them 12,000+ RPM, which is one of the reason they're able to use a single-speed gearbox and still get a full (street) speed range. The motors they're using right now weigh 70 pounds, put out more power than the motor in the Leaf, the single speed transmission is light - doesn't require a clutch, bell housing, etc.

If you want to see an amazing piece of engineering and potential for materials reduction take a look at the combination motor, reduction gear, differential case, with pass-through half-shaft of the Honda FCX clarity 134 horsepower 189 ft-lbs of torque: http://0.tqn.com/d/alternativefuels/1/0/W/A/-/-/Clarity_motor.jpg

"batteries with energy capacities similar to what a gasoline or diesel tank has"

eh? They really only need about 1.5 gallons of gasoline equivalent capacity (150 mile range). Most charging will be done at home and if we can get a proper interstate highway charge infrastructure a car with a 150 mile range could go essentially anywhere.

Yes, 150 miles is a decent range. Out of curiosity, what metals are used in the stator of that motor pic you linked to ? ;-)

Doesn't say...could be UnobtaniumPlus, but even if the weight of the stator or rotor doubles it'll weigh less than a normal reciprocating engine. Rare earth metals are red herrings (if this is what you're referring to) - nice to have but not necessary.

Electric vehicle production is not a problem. Electric vehicle PURCHASES is the problem . . . people don't want to pay more for a vehicle with a shorter range and long refuel time.

The shorter range is unlikely to be fixed. (Well it can easily be fixed with high prices as Tesla has shown but that doesn't work for most people.) People just need to get over it. Short range is good enough for commuting. Rent/borrow/2nd_Vehicle/carshare an ICE/hybrid for long trips.

The long refuel time is not a problem. Refuel while you sleep.

What will fix this log-jam? High gas prices that will hit eventually.

Maybe. It looks like sales of hybrids have gone bonkers in Japan, the only place where hybrids actually have a large part of market share. However, many hybrids have incredibly short driving ranges using only electricity.

High gasoline prices at about 7.75 US dollars a gallon still haven't had any effect on EV adoption in Europe.

"The shorter range is unlikely to be fixed. (Well it can easily be fixed with high prices as Tesla has shown but that doesn't work for most people.) People just need to get over it."

There's just no getting over it...70 miles (50 winter) is horribly limited for a car. Draw a 25 and 35 mile radius circle around where you live - it's going to be abysmal. If JB Straubel is correct and range anxiety kicks in at 20 or 30 miles then for the average person you can make that a 15 to 20 mile radius. A car you feel comfortable taking 20 miles from your house - woot! That'll sell like hot cakes.

I'd venture to guess that the battery pack for the Leaf is running in the $600/kWh range or less...so the problem doesn't require Tesla pricing. If the Leaf is getting 270 Wh/mi that's a $163 per range-mile fix. So for slightly less than $5,000 they can at least cross the 100 mile range psychological barrier...almost as much as their discount from building them in the US. So they have the option of selling them for the same price as they were selling them for before but with a 100 mile range or selling them for $5,000 more than they were before but with 130 mile range. So after tax rebates that would be what - $35,000 for a Leaf with 130 mile range? They'd have buyers - plenty. But these car companies keep sending out duds - poisoned pills - and then going "But they're not selling - nobody wants an EV."

it's going to be abysmal. If JB Straubel is correct and range anxiety kicks in at 20 or 30 miles then for the average person you can make that a 15 to 20 mile radius.

For anyone who considers that abysmal, may I suggest they try walking or even biking that same distance... They might find a whole new way of looking at things. People need to start getting it through their thick skulls that ICE powered automobiles are going to be phased out sooner or later, may as well get ahead of the curve.

I agree, the ICE powered automobiles are going to be phased out, but that does not mean an EV will be a viable replacement, or that people will be able to make the investment in them even if they accept the real reduction in utility.

Again, the EV must be considered as part of a transportation system, not a piece of equipment in isolation. And the demise of the ICE automobile as part of that system will not be a thing happening in isolation, it will be driven by the collapse of our oil supply and attendant economic disruption.

I agree, the ICE powered automobiles are going to be phased out, but that does not mean an EV will be a viable replacement, or that people will be able to make the investment in them even if they accept the real reduction in utility.

To be clear, if you are talking about Leafs and Volts, I agree 100%. When I think EVs it's more along the lines of electric assist velomobiles, GEMs, golfcarts and electric bicycles. Though obviously not EVs, I happen to like regular bicycles, roller blades and walking to public transport as well.

BAU cars, whether ICE or EV are simply not in the cards for the long term.


Lithium and copper supplies are perfectly adequate (we may need to stop building copper roofs and gutters...).

Pure EVs are a red herring - they're not needed. Extended Range EVs like the Volt and plug-in Prius will work just fine. They can eliminate 95% of liquid fuel consumption, and the rest can be provided by ethanol.


Extended Range EVs like the Volt and plug-in Prius will work just fine. They can eliminate 95% of liquid fuel consumption,

That is a totally unsubstantiated claim, in fact I'll go as far as saying it is totally wrong. Trucks, tractors, planes and shipping use well in excess of 5% of liquid fuels without the ability to go to hybrid. Tradesmen and farmers who use utes (pick-ups for the Americans), also will not be going hybrid.

I would recommend you use a dose of reality in your statements, however doing that you only would get one conclusion, collapse of civilization as we know it. The certainty of our situation is highlighted by your off the cuff production of 'facts' that have no chance of actually happening.

Closer to reality is that if all commuter transport worldwide went to public transport and hybrids, then liquid fuel consumption might fall by 30-40%. This only buys us a few years at best. Think of the waste of resources in building all those hybrids as they become useless when there is not enough oil for them.

Trucks, tractors, planes and shipping use well in excess of 5% of liquid fuels without the ability to go to hybrid.

Good point - I should have added the word "personal" - personal transportation could be covered by ethanol, but I agree: biofuels can't cover commercial transportation and freight.

Trucks don't have to - land shippers can go to rail for long haul and EV for short.

Light tractors for daily use can certainly electrify.

Planes and water shipping will have to become much more efficient, and eventually use synthetic fuel.

Tradesmen and farmers who use utes (pick-ups for the Americans), also will not be going hybrid.

Why not? Don't forget, hybrids and Extended Range EVs have been around for 100 years, and get as big as you might want. Think diesel submarines and locomotives.

Regular hybrids are completely fossil fuel dependent. The Volt is the only EREV right now that has a legitimate claim to being mostly liquid fuel independent as the Pri-plug operates in blended mode too often.

Freight needs to move to electric trains with the "final mile" eventually being covered with electrified truck.

In terms of "tradesmen" n' trucks and whatnot - that's one of Bob Lutz's (the force behind the Volt) big new pushes with Via Motors.


If GM were building these directly there would be not only a greater demand for them but they'd be cheaper as well. They use a battery pack the size of the Leaf and get about half the range "40 miles" on electricity alone.

They're aiming these mostly at businesses which means they can pretty much write them off their taxes - a point of contention, no doubt. But they're already building test fleets for PG&E, Verizon, and Rocky Mountain Power.

I think the Leaf is a bit of a truck...the Prius actually has a better coefficient of drag (Leaf .28 versus .26 and .25 2010+ model...and yes, even the CdA of the Leaf is higher). The future of the EV is likely to look more like the Twizy or the EVSTER concept car, or even the original Honda Insight. Then again there's also the Dodge Intrepid ESX and Ford's Probe V concept. The ESX was fairly "normal" looking while the Probe V looked like a massive EV1. If we really wanted to get efficient we could dial on back to 1939: http://ecomodder.com/forum/showthread.php/herr-schloers-goettinger-ei-ha...

But a car like an EVster or a fully electric VW1L should be able to get down into the 150 Wh/mi range meaning a battery the size of the Leaf would give it a 150 mile-ish range. Small, sleek, lighter, less battery, less cost, more range. Smaller cars share the road better with bicycles and EVs in general would make cities and small towns quieter and less polluted. Electric buses for places not serviced by trams, more bicycle infrastructure...the US needs to be re-engineered to have a smaller footprint and re-imagined altogether but there also needs to be a transition path to get there. Amazingly (or not) as noted with record truck sales we're still going in the wrong direction. Europe has a head start since they didn't completely abandon the public sphere, though the UK got Thatcherized in the image of the US so they're a little more screwed. China and India are hell bent on screwing themselves...the last ones buying into the Ponzi scheme.

If population reduction and efficiency improvements can keep pace ahead of decline then we can get out of the trap. Will we? Probably not - but I think the choice is still there to be made, but not for much longer.

Getting out of the PO trap really isn't that hard. There are overnight strategies for 50% reductions, like carpooling and speed reductions, and 50% of vehicle miles come from vehicles less than 6 years old. Every day we stay addicted to oil costs us, but there's no cliff, or point of no return (which is unlike the risks of CC).

EV efficiency isn't that important: 80% of vehicle miles are in the Volt EV range, and we already have surplus night time windpower.

The bigger problem is climate change, and reducing FF consumption: we need to convert coal/NG to wind/solar, and move to EVs of any kind - whatever is easiest to sell.

The reason I mention the driving efficiency point is that it makes multiple things dramatically easier.

L1 charging is essentially limited to 1.44 kW (120V12A). For L2 the old model Leaf has an on-board charger of 3.3 kW and the newest one will have one of 6.6 kW (the Teslas use 10kW and can stack two for 20kW). L3 uses off-chassis rectifiers and could be anything.

One of the more important things is that L1, the common household current, in a pinch can be begged, borrowed (or the other one) almost anywhere. For the Leaf at 270 Wh/mi this gives you (1440/270) = 5.3 mph. For a super efficient car this would be (1440/150) = 9.6 mph. For 100 miles this is ~19 hours in the Leaf, and 10.5 hours in a super efficient vehicle (SEV). This makes L1 a viable option for more situations and probably means you can avoid installing an L2 charger at home - a significant savings right now.

For L2 the game is stepped up. Using the newest Leaf's 6.6 kW charger the Leaf, on L2, could potentially get (6,600/270) = 24.5 mph of recharge. With an SEV at 150 Wh/mi (6,600/150) = 44 mph of recharge. Bringing a 100 mile recharge from about 4 hours down to 2.27...about 2 hours 15 minutes.

Now lets say that you build a Leaf with 100 miles of range. This will result in a battery pack approximately (100mi*270Wh/mi) = 27,000Wh useable. This same battery in an SEV will get you (27,000/150) = 180 miles.

(hand-waving alert ahead)

A 180 mile trip in a Leaf100 would take:
180mi/60mi/h = 3h
plus L2 recharge 80mi/24.5mi/h = 3.3h
for a total of: 6.3 hours (with one recharge stop)

A 180 mile trip in an SEV would take:
180mi/60mi/h = 3h
no recharge necessary
for a total of: 3h

Note that this also means a 50 mile radius without recharge for Leaf100 or 90 mile radius with SEV. If you take a 30 mile "range anxiety" into account this drops to 35 miles and 75 miles - a significant difference.

A 300 mile trip in a Leaf100 would take:
300mi/60mi/h = 5h
plus L2 recharge 150mi/24.5mi/h = 6.1h
for a total of: 11.1 hours (with two recharge stops)

A 300 mile trip in an SEV would take:
300mi/60mi/h = 5h
plus L2 recharge 120mi/44mi/h = 2.7h
for a total of: 7.7h (with one stop)

So you get a longer range with the same battery (same $, or same range for less $) and faster recharging on equivalent current with the same on-board charging (same $, less time waiting). To get there doesn't require hyper exotic materials, just a basic re-think in the way we build cars (they can't be aerodynamic bricks or effin' huge).

Based on the statistics that pretty much every EV site uses an EV with a solid 150 mile range could handle >99% of all round trips without recharging. I don't think there will be mass acceptance until 99+% of all trips can be handled by the car. That reduces the need for a secondary vehicle/rental to a couple of times per year at most.

That all seems sensible, but the massive failure of the original Honda Insight, and the number of people who think hybrids are still tin cans tells me that going smaller and lighter is not going to sell hybris/EVs.

Oddly, any range under 300 miles seems to alarm most people at the moment. I think that will only change slowly.

Hybrids are the Total Cost of Ownership sweet-spot at the moment, and I think EREVs will be the sweet spot when prices fall a bit.

It would be best if there were a wide range of EV/hybrid choices, and the market can evolve as people get comfortable with new choices.

I suspect that if we could dig up the statistics, China also trounced the US in all of the "dirty" electricity investments as well. Coal, nuclear, natural gas, hydro -- choose your own definition of dirty and China probably invested more in new capacity than anyone in the world. Leadership there is attempting to lift another 600M or so peasants to at least a modest working-class existence. That requires prodigious amounts of additional electricity. So China is building.

The World Resources Institute's website shows China planning 10 times the number of new coal-fired plants as the US, providing almost 30 times the new coal-fired generating capacity.

I suspect that it's a race -- can China lift those peasants, or will the whole thing collapse when the peasants revolt over being left behind?

For China from EIA International Energy Statistics in thousand short tons for the coal data:

Year: 2007 2008 2009 2010 2011
Coal Production: 2,844,311 3,021,900 3,301,803 3,505,520 3,844,942
Coal imports: 53,559 43,289 124,406 163,821 192,499
Coal Consumption 2,788,086 2,953,217 3,350,859 3,501,780 3,826,869
Carbon Dioxide Emission (million metric tonnes) 5,228.599 5,537.758 6,292.162 6,568.872 7,178.190
Renewable electricity (TWh) 488.729 596.785 639.280 770.919 797.422
Electricity generation (TWh) 3,090.551 3,280.668 3,508.391 3,904.124 N/A

From 2009 to 2010 the increase in electricity production from renewables accounted for 1/3 of the increase in total electricity generation.

From that table you can see that the CO2 emission value is incorrect.
Based on a C use of 4 gtons/yr, China's CO2 emissions from coal burning alone are around 14.6 gtons/yr.

Plans which won't hold up if China caps its coal production at 4 gtons/yr, which is about its current level.

For today’s entertainment I bring to you a different analogy, nothing organic, just the great physical gyre and dissipative structure, the hurricane. Born rolling off the West coast of Africa, a rising column of air, its moist warmth expanding the distance between its molecules and lifting it like a hot air balloon above its more dense surroundings, opening a high altitude channel into the troposphere. More warm air follows and thick clouds form overhead as cool condensed moisture falls towards the sea. A low-pressure area is formed, a tropical depression. Over sea the flow comes in from all directions and helped by the coriolis force, the storm begins to spin and grow around a nucleus of increasingly low pressure.

Likewise, our Western civilization began as humbly as a single pocket of rising hot air, entraining energy as it slowly grew, sometimes stronger, sometimes weakening, but its dynamics never fully disrupted. Its most explosive growth and most complex form occurred when it hit unusually hot water over the Atlantic and turned into a magnificent storm, a Category 5 monster, except that it was not hot water but rather coal, natural gas and oil that our civilization moved over. We quickly grew from a Category 1 to a Category 5 civilization. The energy this human storm devours is tremendous and gives rise to the complexities of its form that exist to increase the evolution of heat from its fuel source to space.

Now that the eye wall is well defined and it seems to the uninitiated that it will be so forever, what occurs when all the heat is dissipated and the fuel is played out? Will this temporary storm of civilization just dissipate slowly and disappear as hurricanes sometimes do in North Atlantic? Or will it smash onto shore at full speed and dissipate its power across a broad landscape of victims? This brings us to an important difference between a heat moving system and structure like a hurricane that has form and a civilization that has form and moves heat. The civilization is a complex adaptive one with information, sensory organs and a penchant for seeking nourishment. In its many national manifestations, it will behave in such a manner to stay “alive”. A Category 5 society may steal the energy resources from a Category 1 society before it has a chance to develop the structures for extraction and development. However, the wind shear working against the Category 5 may become so great, in the trillions of dollars, that the additional energy obtained is inadequate to the cost. A Category 5 nation may suddenly find itself a Category 4. The United States is now a Category 5 headed for 4. China is a now a Category 3 headed for Category 4, but for how long? Japan is a Category 5 that is hitting some rather severe financial shear which may eventually put them back at Category 3. Eventually there may be nothing greater than Category 2 and some nations may lose all form, structure and ability to use traditional sources of fuel as they become scarce. The pressure to maintain structures will only become greater in the future and some nations will be unable to acquire enough energy to do so and/or may never “develop”. Moving from a Category 5 to a Category 1 in one step, equivalent to a hurricane landfall, could be achieved with an EMP or war that devastates energy infrastructure and use. It should be noted that a nation with a small population, significant guarded resources and less complexity, although considered a Category 1, could over a superior lifestyle.

Nice one

Many thanks for a beautifully expressed, thought-provoking analogy.

I would suggest that "fuel is played out" may not be the primary potential physical issue. The big issue may be that the current global "growth" economy is dependent on a downward entropic curve that is heading for a brick wall. The biophysical costs of obtaining energy are rising as we move from low entropy fossil fuel reserves to higher entropy reserves (deep offshore, tar sands, shale gas etc.). The Chinese government, and other long-term actors, are demonstrating that they understand that this also applies to low entropy mineral reserves. Meanwhile the biophysical output costs in terms of environmental degradation/unexpected climate phenomena are rising.

The person who first expressed this (very) well is Nicholas Georgescu-Roegen:


Finite available low entropy resources, and how we productively and justly deplete them over time, may be the big issue - rather than any conjecture on when peak oil production may, or may not, take place, or which (invented) category of country will seek to to gain advantage over another category of country. We need to take greater responsibility for our current biophysical inheritance and legacy. Now.

- Colin Moorcraft


Renewables are very high entropy, abundant, affordable, etc.

I'd say framing Climate Change as a resource issue (IOW, as in we're depleting the GHG waste sink) is a mistake. That's because GHG's are not an essential waste product, unlike heat.

If I wear hobnail boots on my wood floor, the wood floor's life will be very limited, and wood flooring won't be sustainable (it will wear out too quickly to replace economically). If I wear soft slippers, it will become sustainable. If I'm used to wearing boots inside, then slippers are a big change from BAU. OTOH, I think slippers are a great lifestyle, and there's no sacrifice to changing to them.

So, is the damage to the wood floor a resource issue? No, it's that vandals are wearing hobnail boots.


1. I see some primary renewable energy resources as inherently low entropy. What we do next is our problem.

2. I didn't frame climate change as a resource issue, or as an issue concerning the depletion of greenhouse gases. If there is a question it is: How do we and future generations act now to manage biophysical resources so as to secure the best interests of current and future generations?

3. I agree entirely that you should be free to choose your preferred footware - and flooring.

I wish you the best of luck with your continuing hobnailed destruction of your wooden floor,

- Colin Moorcraft

some primary renewable energy resources as inherently low entropy

But not solar and wind, right?

I wish you the best of luck


You get that I'm arguing for preventing CC, right?

I think we both misunderstood each other. BTW, I heard "output" and thought you were referring to the "waste sink" meme.

Climate change won't be prevented. It is happening.

Unfortunately swapping solar and wind for gas or coal will not, by itself change much.

How we use our primary energy resources is far more important. How useful is a wind/solar/gas powered SUV?

Climate change won't be prevented. It is happening.

Of course. We can do a great deal to reduce additional climate impacts, though. Heck, we could stop GHG emissions, and then start pulling carbon from the atmosphere.

swapping solar and wind for gas or coal will not, by itself change much.

I'm not sure what you mean. You feel eliminating NG and coal emissions wouldn't make a difference?

How useful is a wind/solar/gas powered SUV?

Again, I'm really unclear what you mean. An electric SUV would work just fine right now, what with underutilized night time wind power. Now, I'd like to see a stiff carbon tax incentivize people right out of their SUVs - but in the long term, after we've eliminated FF electrical generation, I see little harm in renewably powered EVs that aren't so efficient.


I've obviously not been very clear. My apologies.

My intended point was that swapping primary energy sources won't help much if it's just feeding a secondary/tertiary energy system that feeds SUVs etc.

I agree full-heartedly with your endorsement of a carbon tax. And renewables clearly should have a growing role. But ...how do we get there?

- Colin

Well, that's the realm of social activism - a large topic.

One thought: have you given $50 to your representative, and asked for a carbon tax (or other action)?

If 10% of the population did that, we'd be done.

90% of the population wants universal background checks for gun purchases. It just failed in the US Senate. Things are not so simple.

Oh, our reps ignore our wishes all the time.

But, don't forget the part where you send $50 first...

Your point is moot anyway because the vehicles coming off production lines **today** are still 99.9% gasoline and diesel powered. In the case of heavy vehicles, ships and planes it's about 100% diesel and gasoline powered.

Fuel taxes have had no effect in Europe on development of EV's. They have had the effect of increasing unemployment, since non-mechanized (slow, low-entropy) activities aren't competitive with mechanized ones (capital intensive, fast, high resource consuming, high-entropy), i.e, I once offered to deliver a patient to the hospital by putting him on my bicycle trailer, but the by-standers insisted on calling an ambulance.

"Fuel taxes have had no effect in Europe on development of EV's. "

Personal fuel consumption is only 18% of the US. That's a big success.

The two statements are unrelated.

High fuel prices in Europe drove the development of more fuel efficient ICE cars, not EVs. Those cars still use more fuel than Europe can afford, but the EV isn't happening anyway - probably because they have access to rail which is a far superior form of electric powered transportation.

Train tracks don't run to every business, they usually run two lines between major cities. Between the tracks and everything else shipment is by truck.

Yes, Europe's problem is freight. Rail is optimized for passenger travel.

No, the two statements are directly related.

High fuel prices kept personal fuel consumption very low: EVs are just one strategy for doing so. At the moment, the average vehicle in Europe only uses about 1/3 as much fuel over it's lifetime compared to the US, so the marginal benefits to greater reductions in fuel consumption are relatively small. They just don't need EVs very much yet. But...EVs are getting started in Europe.

Those cars still use more fuel than Europe can afford

Europe's problem isn't personal fuel consumption, it's freight. Europe's rail system is literally Balkanized, so everything goes by truck or canal (mostly truck). That can be fixed, but it's slow going.

You left out the trivial issue of freshwater groundwater depletion far beyond recharge rates and maintenance of the current industrial edifice.

Yeah. Well written.

Texas: One more threat to the oil sands


Excerpts: The Permian has attracted rising interest in recent years. “This is the second-largest discovery in the history of the world,” said Scott Sheffield, the chief executive officer of Pioneer Natural Resources Co.” Doesn't that seems slightly exaggerated?

Mr. Sheffield startled some participants by suggesting that the basin could hold 50 billion barrels of economically recoverable oil. The Permian .... could reach as high as 3.5 million b/d, Mr. Sheffield said.

However, further down the article, Trent Yanko, CEO of Legacy Oil + Gas Inc. said “Many of the newer plays haven’t lived up to the initial expectations, because the rock is more complicated – it’s very technically challenging to get the oil out of the ground.”

And "technically challenging" typically means it takes more energy to recover and has a lower rate of extraction.

And "technically challenging" typically means it takes more money to recover and has a lower rate of extraction.

I stole that post of yours, Twilight.

LOL - I saw what you did there! However, to me money is just a (more easily manipulated) derivative representation of energy, so it didn't change the meaning.

Yesterday, after leaving the local alternative energy expo I linked to in a post on Monday, I went by a friend's office to discuss what we had seen at the expo and some things we could do to deal with his energy consumption. He had the television on in his office and a program started which can be viewed at;

The Search for Oil

This brought me back to a thread started a post on the September 29. 2012 Drumbeat, in which the prospects for oil discoveries in Jamaica and it's territorial waters were discussed. It was pretty annoying to watch this program, full of wishful thinking and analysis of how oil finds should be handled should they occur (or counting chickens yet to be hatched if you prefer).

In the mean time I have just done some calculations that show that the entire 14 million kWh of Jamaica's average daily electricity consumption could be harvested using solar pv alone. by using 2.8 GW of PV, covering an area of 7.2 square miles or a square of land a little over 2.68 miles on each side! That's all average figures and there's the small matter of storage but, a good indication of the usefulness of the solar resource in Jamaica IMHO.

Alan from the islands

Well... typically there has to be a gap between the solar panels to allow for tilting of the panels and prevent self-shadowing,as well as allow maintenance. This link should give you an idea of how much area of land you need to produce a given amount of solar power, just adjust based on the solar panel efficiency and solar insolation expressed as a ratio to what's used in this array.


That solar power plant, covering 6.47 square kilometers, generates 66 MW continuously, or 662 GWh annually, with 33% of it's generation coming from natural gas fired generators.

Sure but, I was really thinking about the people who say that solar PV is useless because it takes up too much land! The links you provided refer to Concentrating Solar Thermal plants using Parabolic Trough Collectors and I was thinking of solar PV lying horizontally, not tilted at all.

I am leaning towards not tilting panels for some of the installations that I am going to do since we are at 18 degrees north and the sun is actually north of us during the longer, hotter days of summer. When you think that the total area of Jamaica is 4,244 sq miles (10,991 km²) and that 7.22 sq miles (18.7 km²) or 0.17% of the total land area could theoretically supply all the electricity needed, without any conservation or improvements in efficiency, solar PV as a solution doesn't seem unreasonable.

It may well be possible to achieve that level of coverage without using any available land that would be better suited to farming. It may be that a fixed tilt towards the east, to optimize morning production, would actually improve yields since, mountains inland on tropical islands, result in fairly reliable incidence of afternoon cloud cover and convection rainfall.

Food for thought IMO.

Alan from the islands

My point was your calculations are a bit off..

Any solar power you can get going is good !

"I am leaning towards not tilting panels for some of the installations..."

You might want to keep a few degrees of tilt to allow for water/dirt to run off rather than pool on the panel. Natural cleaning.

Thanks, I hadn't thought of that. On the other hand, in a hurricane prone area, a horizontal array on top of a flat roof has some advantages (better aerodynamics).

Alan from the islands

Insight: how the Jotï concept jkyo jkainï could help the West live sustainably

This paper travels through the notion of jkyo jkainï, which can be translated as love to everything: our surroundings as well as all sentient beings. It is a term used by the Jotï, a group of about 1200 people who dwell in the rainforest of the Venezuelan Amazon and Bolivar states. After 15 years of contact with several hundred Jotï people and through a slow understanding of their comprehensive philosophy, the ecogony – or causal reasons – that trigger Jotï behaviour in relation to other entities and the forest can be partially described here.

The Jotï have developed a multifaceted lifestyle that rests on a hyper-awareness of how all living things depend on each other and on their biophysical environment at macro and micro scales. Interdependency confers rights and duties to all the parts in the biosphere. A set of pragmatic tenets sustains the continuity of Jotï lives: ijtekï-bëjkyadï (sharing, interconnectedness), balebï (movement, interaction, predation), wëjlakï-bëjkya (Umwelt), au jkwaï (interpenetration of essences), and me dekae (dwelling).

Full Article: Jotï ecogony, Venezuelan Amazon

Interesting read. There is lots to learn from these people. But

Their extensive ecological, phenological and etiological knowledge has syncretic, utilitarian, symbolic, functional, ceremonial and definite referents.

Obviously not very much was gained when english replaced latin as the standard language for scientific writing.

Obviously not very much was gained when english replaced latin as the standard language for scientific writing.

Fussy, fussy. Why, there are three words in that quote which are clearly English. If there are another eleven still in Latin, obviously they describe concepts which cannot be expressed in English.

If there are another eleven still in Latin, obviously they describe concepts which cannot be expressed in English.

Actually, some of it is kinda Greek to me... >;-)

I don't know, it made perfectonius sensaronius to me. ;-)

Ha! and that, from someone who studies the 'Oikos'... also know as an ecologist, eh? Ok, how bout we just call it Greco Roman influence and be done with it >;-)

Seriously, we could probably learn a thing or two from these people.

"from someone who studies the 'Oikos'"

Not just a yogurt. Next you're going to tell me that "Hulu" isn't just a streaming media site and "Ubuntu" isn't just a Linux kernel operating system! :P

Fascinating stuff, Seraph.

Contrast what I excerpted below from the conclusions section, with our monoculture based Agro-industrial practices...

5. Some conclusions

(1) The Jotï life-strategy could easily be discarded as obsolete, minimalist and untested. Beyond defending blindly an ecological noble savage stance, there are solid grounds for sustaining that Jotï environmental ethics and their overall ethos support the maintenance of local or regional biodiversity or even enhance it. Phytosociological studies carried out in 4 ha of forest plots (used daily by the Jotï) at four different Jotï communities showed not just maintenance of vegetal diversity but also enhancement of plant species to the extent of harboring the richest forests in species (highest α and β diversity) thus far documented in the Venezuelan Guayana (Zent and Zent 2004c, pp 2475–7). The four hectares of forest inventoried never reached an asymptote, accounting for a total of 65 families, 232 genera and 533 species, including some unidentified vouchers. Within each plot and between them there is high diversity since less than 20% of the total inventory of species are present in two or more plots. The average degree of similarity in species composition for plot pairs was 12% and 18% using the Jaccard and Sørenson similarity coefficients respectively. Such richness is sustained by dynamic intervention strategies (harvest and dispersal of fruit trees, use and handling of palms, monitoring and management of palm grubs, gap cultivation, and honey extraction) traditionally practised by the Jotï to modify and create biological diversity (Zent and Zent 2004a, 2004b, Choo et al 2009, Zent and Zent 2008).

Emphasis mine.

So who would you rather have as stewards of our ecosystems? The good folks behind Monsanto or the Jotï?
I also wonder if the Joti would be at a loss for words to describe hill top removal to mine for coal or other equally destructive methods to get oil out of tar sands ... both rather barbaric and primitive practices, IMHO.

I often wonder if science realy was a good idea in the first place. When the concept of science was first developed, the debate was not weather it was possible to do it or not, but weather it was a good idea. I think I am sideing with the sceptics in that debate.

Science at the beginning was more about knowledge than "doing" (although always kind of mixed), techno science these days (in biology or technology) is almost only about doing

Science and technology are intimately related now, although originally, science was more about providing an explanation of how technology worked.

Science advances when technology provides the instrumentation, apparatus, and most recently the computing power, to investigate new phenomena.

Technology advances when science provides validated theories that can be used to create new instruments and models.

"an explanation of how technology worked."

Would say more about how nature worked (and then there is also maths), technology is science in two different ways somehow, the basic nature laws used, and then the new machine or invention aspect, which can be considered a new piece of "science" in itself

For some sciences it is true that they just explain nature, without informing technology. For example, astronomy is the science of unearthly things. Astronomy is enabled by technology (manufacture of glass, grinding of lenses, making of telescopes, etc.) but it provides little that is of use to improve technology.

The more common situation is that technology is ahead of science. In mechanics people built catapults before they understood the mathematics of levers. The built ships without knowing Archimedes Law. Alchemists experimented with chemical reactions without knowing about atoms or the periodic table. Geneticists mutated organisms with radiation and mutagenic chemicals before they knew about DNA.

In many cases science progressed because the rules of thumbs and heuristics used in the industrial arts failed. Boilers blew up, ships rolled over shortly after launching, etc. In fact, science usually progresses because an experiment fails -- if you get the predicted result, you haven't learned anything.

Yes this is also true, but for Newton, Einstein (or Poincaré), the XVIIIth century naturalists, or a lot of mathematicians for instance, the "useful" objective wasn't there I think, more knowledge quest and "game" spirit.

Often science generates the need for tech advances. The scientists needs to figure out how to measure this, or how to create an appartus to subject a sample to that. So he may be highly motivated to come up with a way. Then others find that way useful for some other endeavor. Institutional as well as discipline boundaries get real fuzzy.

The applied scientists, engineers and technicians who design and build scientific instruments and apparatus are the unsung heros of the process. The work is demanding, often requiring mastery of multiple scientific and technical disciplines, working with novel materials and components, and achieving high precision and reliability.

Perhaps science is simply used as a means of removing limitations, and that is the real issue. Humans without limitations are a big problem.

Perhaps science is simply used as a means of removing limitations

I strongly disagree! I think you are confusing applied technology with pure science.

Science is about understanding how nature works. It actually helps us understand what our real limits are.
For example, do you think science can revoke the laws of thermodynamics for us?

Yes, science does give us the knowledge and the technology to say, clone human beings, if we should decide to go down that path but it doesn't remove the natural limits to continued population growth. If anything it helps us define where those limits are.

It's mostly cornucopians who do not understand the limits of the natural world who think that technology, which they confuse with science, will forever save the day!

Well, at risk of aggravating.. since I know this reference is objectionable to you, here's where I think Crichton had some useful points to make with Jurassic Park.

Hammond: How can we stand in the light of discovery and not act?
Ian: What's so great about discovery? It's a violent, penetrative act... ...that scars what it explores. What you call discovery... ...I call the rape of the natural world.

"..Science has attained so much power that its practical limits begin to be apparent. Largely through science, billions of us live in one small world, densely packed and intercommunicating. But science cannot help us decide what to do with that world, or how to live. Science can make a nuclear reactor, but it cannot tell us not to build it. Science can make pesticide, but cannot tell us not to use it. And our world starts to seem polluted in fundamental ways---air, and water, and land---because of ungovernable science.”

.. and if that lands with a thud, how about Mr. Spock?

"Logic is the beginning of wisdom, Saavik, not the end." (Star trek 6 The Undiscovered Country, I think)

In the main, I think we pretty much agree, and it's just cobbling out the definitions and the details of it. I don't think 'Science' is bad, any more than I think 'Jazz' is good. There are just too many families whose mail comes addressed to each of those names to be able to sum it up that cleanly.

speaking of logic

ei+π + 1 = 0

those who truly grasp the significance of Euler's Equation (and I am most definitely not among their number) are in awe of such a seemingly 'out of the blue' relationship

The mathematician Carl Friedrich Gauss was reported to have commented that if this formula was not immediately apparent to a student upon being told it, that student would never be a first-class mathematician.
Source Wikipedia

And that, in a nutshell, is why I never became a first-class mathematician >;-)

I wonder if our great sage Carlin could have brought it down to earth for the rest of us to taste, he was a master of the paradox?-)

so to the paragraph in the same piece following the one you blockquoted

After proving Euler's identity during a lecture, Benjamin Peirce, a noted American 19th-century philosopher, mathematician, and professor at Harvard University, stated that "it is absolutely paradoxical; we cannot understand it, and we don't know what it means, but we have proved it, and therefore we know it must be the truth."

I believe the correct formula is e raised to the π*i (not e raised to the π+i) + 1 = 0

I did add an extra + to the mix, thanks

e = -1
e + 1 = 0

are the proper statments, sorry for the error. It likely is 'obvious' my original ei+π yields a positive number and that it gets uglier after that. Anything using imaginary numbers is beyond my pay grade these days, can 'i' even be added or subtracted? I must be more careful how I copy stuff ?-)

Well, applying the term "positive" is a bit dicey since C is an unordered field but

ei + π = eπ (cos 1 + i sin 1)

~= 12.50 + i 19.47

Piece of pi!

Once you play with it a bit, complex algebra is actually easier than real algebra. Just take ordinary algebra and add the fact that by definition i*i=-1, and it all comes out in the wash. e(ix)=cos(x)+i*sin(x) comes from the Taylor series expansion (is there another way?), and once you get it, makes trig much much easier.

Well, that may be valid. I'm not really advocating intentional ignorance either, really just musing anyway. I'm rather addicted to trying to understand things. Still, learning about the true nature of limitations seems to inevitably lead to efforts to "game the system", or push back the limits. These things give people comparative advantages and so are the kinds of things that get supported.

I wonder if the kinds of knowledge we seek could be better directed?

Let's be clear: those who tell us not to worry about Climate Change or PO are not really believers in tech, though they may mouth the words. They are just PR flacks for the FF industry, which doesn't want it's jobs and profits hurt.

And yet the real problem is population which almost no one wants to talk about.

All the science and technology in the world does nothing if we refuse to even acknowledge there is a problem and completely refuse to act on it.

Population isn't the main problem.

Even if population was 1/2 what it is now, we'd still be in trouble climate-wise. OTOH, even with our current population, we could fix climate change if we really put our minds to it. It wouldn't even be that expensive - perhaps the cost of one or two Iraq wars.

Population 1/2 what it is now is still far into overshoot.

Only because we're polluting. We can change that, and relatively easily. If only legacy industries would stop fighting their obsolescence, or the rest of us would learn to overcome/bribe them.

Yeah, right... If it's so easy, why hasn't it been done???

Well, it's being done to a greater or lesser extent in a lot of places - Germany, Sweden, etc. The US and China are both doing quite a lot, just not nearly enough.

I don't think the politics are easy, but it's extremely useful to know that the primary problem is social, not biophysical, right?

If only as info for the victims of FF-industry propaganda.

but it's extremely useful to know that the primary problem is social, not biophysical, right?

While there is certainly a political and social component that makes solving these problems even more difficult, it is incorrect to state that the problem is not biophysical. Ecological overshoot is very much a biophysical problem.


I like this metaphor:

If I wear hobnail boots on my wood floor, the wood floor's life will be very limited, and wood flooring won't be sustainable (it will wear out too quickly to replace economically). If I wear soft slippers, it will become sustainable. If I'm used to wearing boots inside, then slippers are a big change from BAU. OTOH, I think slippers are a great lifestyle, and there's no sacrifice to changing to them.

So, is the damage to the wood floor a biophysical problem? Sure. Is the primary problem biophysical? No, it's that some vandal is wearing hobnail boots.

Written by Nick:
If I wear hobnail boots on my wood floor, the wood floor's life will be very limited, and wood flooring won't be sustainable (it will wear out too quickly to replace economically). If I wear soft slippers, it will become sustainable. If I'm used to wearing boots inside, then slippers are a big change from BAU. OTOH, I think slippers are a great lifestyle, and there's no sacrifice to changing to them.

You switched from wearing out the floor quickly to wearing out the floor slowly and wearing out slippers annually. Neither of these are sustainable with 7 billion people on Earth because there are not enough trees for everyone to have wooden floors nor enough enough leather (animal hide) for everyone to have slippers. Some people must have concrete floors and others, dirt huts. Some must have shoes with synthetic soles and others, bare feet.

You switched from wearing out the floor quickly to wearing out the floor slowly and wearing out slippers annually.

It's a switch from wearing out the floor in 5 minutes, to wearing out the floor in 50 years (give em a good buff every several years, sand them lightly every 10 years, they'll last 50 years easily, and 100 isn't unreasonable - heck, I've seen 300 year old wood floors). That's a difference of 5,000,000 to one. If we reduced GHG emissions by 5,000,000 to one, that wouldn't make a difference?

there are not enough trees for everyone to have wooden floors

Sure there are. Remember, a good wood floor will reasonably last a century. Heck, They'd even sequester carbon...

nor enough enough leather (animal hide) for everyone to have slippers

Synthetic is fine. That's what I wear.

Sure there are. Remember, a good wood floor will reasonably last a century. Heck, They'd even sequester carbon...

Sigh! Of the 7 billion plus humans already on this planet probably 99% think exactly like this. Logic and facts don't stand a chance. I hope I don't run out of popcorn before the end of the show... >:-(

At least yeast have an excuse, what's ours?!

probably 99% think exactly like this.

No, they don't. I'm advocating fast reductions in FF consumption, and you're confusing me with advocates for no change, who pretend to believe in tech solutions as a red herring.

Well, it's being done to a greater or lesser extent in a lot of places

Appreciate the effort but there are a billion people in developing countries waiting to drive cars, buy their first LCD, Fridge etc. The cumulative effect of their economic growth will dwarf any conservation efforts, it will be like ratcheting up the world's population to 10 billion or more.

They will be waiting for a long time - long enough for us to join them in the ranks of those without.

Sure, but between greater efficiency and abundant wind and solar, energy isn't the problem.

What have you observed happening with solar in India? In many places it should be cheaper and more reliable than grid power...

"If it's so easy, why hasn't it been done???"

Because people are not (yet) suffering any consequences that can easily be blamed directly on the pollution.

The odd thing is, they are. You don't have to count GHGs at all, to find enormous costs to the US public.

The US has hurt itself badly with oil wars and oil deficits. The cost is huge in money ($500B per year each for military spending and trade deficits), physical and mental battle injuries, stress for the whole population because of fear of "terrorism", loss of the US' reputation for morality, misdirection of engineering talent into war-related tech, etc, etc, etc.

The US could have made an incredible investment in renewable energy with the cost of the two recent oil wars.

The US could have spared itself enormous suffering, by kicking the oil addiction.

Don't get me started on the non-CO2 occupational, health and pollution costs of coal...

But those are indirect. We liberated Iraq from a tyrant that had nasty stockpiles WMDs aimed at us dontcha know?

Terrorism? That's because "they hate our freedom".

Health effects from pollution? That's what those ivory tower 'scientists' may say with their complex epidemiological studies . . . but those are the same people that try to trick us with their evilution lie straight from the pit of hell and their climate change hoax!


And how do we know that?

Fox News tells us so...

It's amazing to me that so many presumably well educated and smart people never think of the huge opportunity costs you mention. I gave a talk to emeritus profs of a local university on that point, with a lot of detail comparisons of military hardware vs what same effort would buy in solar, etc, and they seemed genuinely surprised at the news, and thanked me for educating them!

Yes, but the current vehicles don't use electricity. So they feigned being surprised (put on a poker-face), and kept on doing what they were doing.. inertia is hard to beat.

"The cost is huge in money ($500B per year each for military spending and trade deficits)"

Sadly, your aim is a little low.


The estimates, including running healthcare costs, debt payments, etc is running around $3 Trillion these days.

speculawyer, I think you have a point.

As I have said before, I don't know that people really need songbirds, or coral reefs, or tigers. To make this clearer - everywhere people have gone, species have gone extinct, often in droves (such as in Polynesia). Yet life goes on just fine in New Zealand, despite the extinction of the Moa. All those species that suspiciously didn't make it out of the last ice age despite having lived through other periods of climate change, like mammoths and giant sloths? Well, it looks like we're living without them.

I think pollution is similar, in that as long as it doesn't kill us pretty quickly, it doesn't matter. People seem to be okay with their lives being cut short by a decade or two if it means they have certain things. Heck, millions of people cut their lives short with tobacco, alcohol, or other drugs, or by choosing to work in dangerous professions.

That said, there is a distinct possibility that solar and wind are going to undercut coal and gas. The transition has already started, and is moving quickly. If it succeeds (is not cut off by extreme events), then transportation will become the issue. Ultimately, the answer to that is mostly very simple - don't go as far as often, walk, and bike. So you need to go "back to the future" and rebuild walkable cities.

Humanity is walking a knife edge. Perhaps it will all fall apart. Perhaps it will degrade to a lower level (ala Rome). Perhaps it will hold together. The more I have considered it, and considered existing trends, the less certain I am of the result. I don't think the reefs and forests will do very well... But humans may do fine.

I don't think the reefs and forests will do very well... But humans may do fine.

Wanna bet?!

Just think of the classic cartoon scene where Wiley Coyote runs right on past the edge of the cliff into thin air and the stops and looks down... Oops!

Its not clear what the sustainable limit really is. Many here like to take the population just prior to industrialization and state, that is it. But if we still have tech and science, we ought to be able to exceed those amounts. But there could be a bunch of limits that aren't obvious and could be missed. Current industrial agriculture requires fertilizer inputs, some of which are obtained from mining a finite supply. There could be other weak links in the chain that might prove to be limiting, but anything whose time constant for being used up is greater than a couple of centuries is easily missed or dismissed.

True. But, the limits aren't energy.

BTW, if you want info on phosphorus, I can provide some.

I'd still put fresh water use as number one.

There are a lot of solutions to water problems, if you have other resources.

Recycling, greater efficiency, different and/or better crops (e.g., less rice grown in the desert, less beef), desalination.

.. or reducing the amount of concrete used in construction.

Only because we're polluting. We can change that, and relatively easily.

No, it is not only because we are polluting. Google: "Global Footprint Network"
I'm not sure how you define 'relatively easily'...

Yes, I'm familiar with GFN. If you look at the components, you'll see that climate change is very big. Elimination of FF brings the numbers well under the sustainable level.

Relatively easy: perhaps the cost of one or two Iraq Wars, over 20 years. Less than 1% of annual GDP.

Oh I think they may believe in the technology. But 'believe' is the right word . . . it is a religious-like belief. They don't fully understand the technology and its limits. They just 'believe' that some magic technology will come along and save things because that is what always happened in the past. But the problem is that our technology is starting to bump up against the laws of physics.

They only believe that because it's convenient. People very often do believe their own rationalizations, it's true. But, once the rationalizations aren't needed, they can be dropped pretty quickly.

We can not pump up that ultra deep oil without a deep understanding of physics. We can not create many of those chemicals without deep understanding of chemistry. Without science, we could never have ramped up environmental destruction to the levels seen today.

Science is just understanding. It is the technology we make with it that is the problem. We humans were obviously smart enough to figure out science, but I don't think we were wise enough to use it responsibly.

Yet we've had past civilzations that managed to mess things up very badly. Don't understand irrigation and salt buildup, and you can destroy your civilizations ability to feed itself. There are lots of system level things that if ignored could sneek up and get you. Without science you may not even know what hit you. With it you may be able to identify the issue, but can you get the wider civilization to deal with it?

I think we are wise, but we are also extremely greedy and uncaring. As long as the consequences don't affect US, we don't care. If it affects someone else (in a different place or at a later time), we just don't care. And even if it is our own progeny that will be affected, we'll just rationalize a way not to care.

Nope, the only way things will change is when we are smacked down hard by undeniable bad consequences from our behavior. Then we will change. Maybe. (It might take several smack-downs.)

Engineering is the culprit. Science without the engineering to take advantage, is by itself only knowledge.
There is a good book everyone should read...."You Are Not So Smart" David McRaney.
Easy to understand and read, it will give a clear insight into why we behave as we do.

Late to this thread, and just using your latest comment on it to put in my 2c, spec, not directly responding to you - but I just want to ask if (and if not suggest that) all here have read Catton's Overshoot? Global industrial civilization - or Homo Colossus as he terms it - is reaching both far back in time and into the future (in a sense) to rapaciously consume resources to feed the current overshoot. The problem is indeed population, but then it is multiplied by consumption to be outrageously out of balance with anything the planet can support for any significant length of time. Check out Paul Chefurka's recent graphic depiction of said relationship as well. But read Overshoot. It tells the tale well. We are deep in it.

Permafrost regions: from carbon sink to source by 2100

... "In our simulations, the permafrost zone loses its capacity to sequester carbon under almost all considered levels of global warming," said Sibyll Schaphoff from the Potsdam Institute for Climate Impact Research, Germany. "The current sink will be amplified until 2050 but already around 2080 it will diminish or even turn into a source in 2100. Only for the 3.0 K global-mean-temperature-increase scenario does the permafrost zone still constitute a small sink."

Heat pumps v CHP/DH

There has been a long and interesting debate over whether Heat Pumps or Combined Heat and Power plants linked to District Heating Networks are the best option for efficient low carbon home heating.

... Heat pumps have an energy output/input Coefficient of Performance (COP) of maybe 3, but since they are using some of the heat that would otherwise be wasted, CHP plants linked to DH can deliver a COP equivalent of up to 9, or more, depending on the grade of heat that is required (Lowe 2011). And if CHP plants use a renewable source of heat, like geothermal or biomass, their carbon emissions, already low/kWh, should be even lower, and cost less/tonne of CO2 saved than heat pumps (Kelly and Pollitt 2009). Though, there is some debate on this; it may depend on the carbon content of the electricity used by the heat pump and the grade of heat that you want out (Woods 2011; MacKay 2013).

It is true that installing district heating (DH) mains can be disruptive, more so than installing heat pumps in individual houses. But once installed and linked to the central heating radiators of houses and other buildings, unlike with domestic heat pumps, there is no in-house device to maintain. Moreover, once installed DH pipes can be fed with heat from any source, as they become available, including solar and geothermal energy and it become a major infrastructure asset. That helps make large scale solar heating linked to heat stirs viable in Denmark- it’s claimed to be much more economic than individual house solar heating, if you already have the DH network.

In urban districts DH is a good option, however, the combination of CHP, which have a requirement for high FLH, with DH, low FLH, may only be possible in some cases. The 85% reached in case of a German project will very likely not be the rule.

In some rural districts or districts with low housing density the heat pump shines as it uses already availbale infrastructure.

Another aspect is that DH of course allows to store excess electricity production from wind as heat for a very low price.

I think heat pump COP could be better than 3, that's really low. Also, geothermal isn't renewable, it gets used up just like the others. Biomass is technically "renewable" but not really; it's nowhere near scalable to what would be needed to make a dent in our building heat needs. It's basically a no-go, probably one of the worst sources of heat we could get from a planet that will soon be severely strained to just provide food for us.

The COP will vary according to your climate zone. I'm in Zone IV, so the Fujitsu 12RLS2s that we install have a HSPF or heating season performance factor of 12.0. That works out to be a seasonal COP of 3.5, which is pretty much the upper reach for any air-source heat pump (this particular model now produces a good amount of heat all the way down to -27°C).

We're pushing a lot of these units out the door. Earlier today, I specified two 12RLS2s for a client that has seventy-six linear feet of electric baseboard heat in their front office. In this case, there are continuous rows of baseboard heaters on both the outside and inside walls, which is highly unusual (take a close look at the bottom of the left wall).

 photo Img_2297_zpsbea4dca8.jpg

This will cut the space heating requirements in this part of the building by about 70 per cent, but the single biggest benefit will be tied to the customer's improved load factor. Right now, whenever the thermostat calls for heat, all 19,000-watts spring into action; on a mild day like today, the Fujitsus could easily loaf along pulling 200 or 300-watts each, and on the coldest days of the year that might climb to perhaps 1,500-watts.

The client pays $9.921 per kilowatt of demand, so that thermostat call represents $188.50 per month in demand charges for each of the six or so months of the year that heat is required in this area. In addition, the first 200 kWh per kW of demand, per month, are charged at the higher cost first tier, so they're paying an additional $117.76 a month in higher energy costs due to this one hit on their load factor. Thus, these two Fujitsus will reduce their operating costs well beyond what you or I could expect as a residential customer.


There must be a mistake there - there is no way a district heating system can produce more energy than it burns unless it itself has a heat pump (the paper is paywalled so how they get their virtual COP is not clear). The overall efficiency (not COP) for a modern power station (efficiency ~40%) driving a good heat pump (year round COP ~2.5) is 40 x 2.5 = 100% and the district heating cannot match that. If you combine the two you get a reduced electrical efficiency so something like 35% heat fired as electricity and 50% recoverable heat (85% efficiency) or with the electricity driving the heat pump 35 * 2.5 = 87.5% for the heat pump side + 50% CHP for a total of 137.5% efficiency or COP of 1.38

You're misunderstanding what's being said.
A heat pump converts 1 unit of electricity into 3 units of heat.

CHP/DH is extracting heat from the low temperature part of the power station cycle. If you bleed off some heat at higher than the normal condenser temperature you'll reduce the overall efficiency of the power station.

There's something called the Z factor, the ratio of heat produced to electricity lost for a given fixed fuel input. It's about 6 for conventional coal-fired steam plants, but can be as high as 10 for CCGT plants.
Thus in a CCGT 10 units of heat can be produced for the loss of 1 unit of electricity. This is a much better performance than a heat pump.


Thanks, makes sense (was not clear to me they meant based on what happens to the potential electricity not the fuel) but basically is an argument for doing both rather than for not doing heat pumps. In my example you lost 5% of the fuel that was making electricity changing to CHP to get 50% of the fuel as heat so they say this part of the system is the same as a heat pump with COP 10. This is great but the argument that therefore we must use CHP instead of heat pumps does not follow since the heat pumps scale and the CHP does not. You cannot scarifice another 5% of electricity to get CHP heat* but via heat pump you could get something like 15% more. The concluson (drawing the boundry round the whole system not the top 5% of possible electricity) is do both where the whole system supplying heat has a potential COP above 1.

*Or maybe you can... A 'perfect' system could bleed just enough EXTRA heat (if needed at moderate temperature) from the high temp side of the steam cycle to match the installed heat pump base COP overall. My numbers were very rough and based only on what you loose in efficiency by the extra downstream load driving the DH system.

Thus do some district heating systems as the best option in cities (pity they are so rare in the UK) but use heat pumps (often replacing oil, LPG or resistance heat in the UK) elsewhere, with the advantage that the heat pumps can run off wind and PV without further change.

It is correct that a good fossil power plant plus heat pumps beat every DH system, the point is that many houses are not suitable for pumps and DH may allow to stor very cheaply excess electricity (from wind) as heat.

Another good reminder that the question isn't really 'Either-Or?' .. it's usually the congregation of various solutions, to provide a broader and more flexible base to stand on.

There must be a mistake there - there is no way a district heating system can produce more energy than it burns unless it itself has a heat pump

The big question is if a district heating system can produce more energy than it burns with a heat pump if the energy to run the heat pump is taken from what it burn.

If not heat pumps are in practice just another method to transfer energy since most electricity is produced by burning a fuel.

Leasing can broaden market for rooftop solar panels

A new study shows that leasehold options are appealing to consumers and can open up the photovoltaic market to a large segment of new customers.

... On paper there were no significant demographic differences between the lessees and buyers of photovoltaics: they were all wealthier, older and better educated than the average Texas resident. However, by digging underneath the demographics, Rai and Sigrin found that lessees did differ from buyers in a few important ways.

"Most of the lessees we interviewed would not have installed if it was not for the leasing option," explained Rai. "In general, we find that the leasing model is able to break into consumer segments marked with tight cash flows."

But leasing can have disadvantages too. "One additional potential complication with leasing is the potential situation when the leasing company goes out of business," said Sigrin, whose findings are published in Environmental Research Letters (ERL) . "We don't know fully yet what type of financial burden will that add to the leasing customers."

they were all wealthier, older and better educated than the average Texas resident.

They're not moving to solar because they can't afford utility power, they're moving because solar is a better value.

The affluent pay a lot of attention to efficiency and value.

OK your first sentence kind of makes sense. Your second one? Affluent pay attention to efficiency and value? Come on...

Absolutely. Their idea of value may be different from yours, but they very often "squeeze their nickels till the buffalos poop", as Rocky likes to put it.

That's often how people become affluent.

"One additional potential complication with leasing is the potential situation when the leasing company goes out of business,"

Which which makes a strong argument for Public (Owned) Utilities, or at least regulated utilities. Not a total free market approach. If the customer can be expected to be long term then the supplier should be comitted to a long term ongoing concern business plan.

About Stuart update above :

and :

This eliminates biofuels, natural gas liquids, and refinery gains from the picture, and is a more purist definition of oil.

A bit picky but my understanding is(or was) that condensates and natural gas liquids were more or less the same thing.

taking the definitions of the EIA :

"leased condensates : A mixture consisting primarily of pentanes and heavier hydrocarbons which is recovered as a liquid from natural gas in lease separation facilities. This category excludes natural gas plant liquids, such as butane and propane, which are recovered at downstream natural gas processing plants or facilities."

So what I make of this is that :
NGL = natural gas liquids
LC = lease condensate
NGPL = natural gas plant liquids

So that C+C does contain a (big?) part of NGL, only NGPL excluded.

Note : couldn't find a way to have respective volumes for LC and NGPL on eia site, but maybe didn't look hard enough.

If somebody could clarify ...

A bit picky but my understanding is(or was) that condensates and natural gas liquids were more or less the same thing.

Condensate is a liquid at room temperature and sea level pressure, natural gas liquids are not. Condensate is like gasoline or naphtha with a polymer length of 8 carbon atoms, (mostly). Natural gas liquids are shorter.

Though condensate is technically a natural gas liquid, it is counted different because NGLs must be contained in a pressurized container and condensate can be transported just like oil or gasoline. Condensate is often mixed with very heavy oil in order to lower the viscosity in order to transport it through a pipeline. You cannot do this with NGLs.

One big difference is condensate is measured in barrels and priced in barrels very close to crude. NGLs are priced in cents per gallon with the lighter, or shorter strings, being cheaper than the longer.
Search: 2012 Brief: Natural gas liquids prices down in 2012 Condensate is called "Natural Gasoline" in the chart at this site.

Ron P.

Sorry still not getting it :-)

Is what is called "condensate" and "Lease Condensate" the same ?
Or in other words is the second C in C+C short for LC ?
(there is no definition for "condensate" on the eia site)

in that case as the eia states :

lease condensate : A mixture consisting primarily of pentanes and heavier hydrocarbons which is recovered as a liquid from natural gas in lease separation facilities. This category excludes natural gas plant liquids,

Is it correct to say that when not precised, NGL is short for NGPL, (and so not counted in C+C), but overall :
NGL (or gas liquids) = LC + NGPL


Yes, condensate and lease condensate are the same thing.

Search Oil industry Jargon de-coded

(2) The heavier hydrocarbons that are liquid at normal temperatures are often called 'lease condensate', 'natural gas condensate', 'natural gasoline', or 'casinghead gasoline'.

As for any difference between NGLs and NGPLs, I have no idea but I think they are the same. I don't think condensate, though technically a natural gas liquid, is usually counted in either catagory. But I could be mistaken.

Ron P.

"Lease condensate" is a peculiarly American term, referring to natural gas liquids which are in the gaseous form in the natural gas reservoir, but when produced from gas wells, condense (hence the term "condensate") to liquid at the surface and are stored in tanks next to the wellhead.

In Canada, we usually recombined the liquids with the gas at the wellhead and flowlined them together to a centralized gas plant, where the heavier fractions were separated and stored in the "pentanes plus" tank at the gas plant, which stood next to the propane and butane tanks.

We also sometimes flowlined crude oil into the gas plant, where after going through the separators it would end up in the "pentanes plus" tank as well. There is really not much difference between pentanes plus and light crude oil.

We would only call it "condensate" if we collected it directly from the gas wells. But, really, it's the same thing as "pentanes plus" - in US terms a natural gas liquid, in Canadian terms, not so much.

We also called it "field condensate" because, while in Texas production was reported by lease, in Canada it was reported by well and producing zone. We didn't really care about leases.

Many thks Ron and RMG for the info, much clearer now (kind of ;) , but I forgot most of what I knew in organic chemistry ...)
Maybe if everything was counted in energy units for fuels it would give a clearer picture

"Maybe if everything was counted in energy units for fuels it would give a clearer picture"

An energy description is much more specific than a volumetric evaluation. We use exergy analysis throughout our study, and only convert to volume at its conclusion (for those who still like barrels). Exergy is the maximum theoretical amount of work (BTU) that can be extracted from a fuel. It is calculated from the combustion equation of the hydrocarbon in question.

A 35.7 deg API sweet crude has an exergy of 140,000 BTU/gal (19,806 BTU/lb). The average 2000 - 2005 production reported by the EIA gives 140,075 BTU/gal, stdev = 273. Pentane is the last hydrocarbon on the list that is still a liquid at std. p, T. It has an exergy of 107,400 BTU/gal.


Condensates are hydrocarbons with an API => 60, and would ordinarily consists of heptane, hexane and pentane. As there is a considerable differential in price between condensates and crude, producers often blend some of their condensate in with their crude. Octane has an API of 68.7, but is ususally included in crude. This is all closely related to the Gibbs free energy function for the particular hydrocarbon.

The Hill's Group

TEEB for Business Coalition Study Shows Multi Trillion Dollar Natural Capital Risk Underlining Urgency of Green Economy Transition

The report, “Natural Capital at Risk – The Top 100 Externalities of Business”, estimates the global top 100 environmental externalities are costing the economy world-wide around $4.7 trillion a year in terms of the economic costs of greenhouse gas emissions, loss of natural resources, loss of nature-based services such as carbon storage by forests, climate change and air pollution-related health costs.

Headline findings are:-

- The primary production (agriculture, forestry, fisheries, mining, oil and gas exploration, utilities) and primary processing (cement, steel, pulp and paper, petrochemicals) sectors analyzed are estimated to have externality costs totalling US$7.3 trillion, which equates to 13% of global economic output in 2009.

- The value of the Top 100 externalities is estimated at US$4.7 trillion or 65% of the total primary sector impacts identified.

- The majority of environmental externality costs are from greenhouse gas emissions (38%) followed by water use (25%); land use (24%); air pollution (7%), land and water pollution (5%) and waste (1%).

Bullet holes riddle key California power substation causing heavy damage — 10,000 gallon oil spill — Statewide Emergency Alert to conserve energy — 911 calls not working nearby

and Sabotage: High-powered rifle used in attack on California power substation — Same perpetrators blamed for cutting AT&T fiberoptic cables — Objective was “shutting down the system” — FBI now leading investigation (VIDEO)

A Silicon Valley power substation was damaged after rifle shots were fired at it early on Tuesday morning, leading the California grid operator to call for electricity conservation. [...] Investigators later determined a high-powered rifle had been used [...] About a quarter of an hour before the shots, someone cut fiber optic cables belonging to AT&T, located about a half-mile from the power station and due to the close timing and proximity, investigators believe the incidents are linked, he added.

Zoneminder-type systems that motion-capture and are configured to send their data via cell phones would help catch the baddies....

No doubt such things could help, but there are always measures/countermeasures in a escalating cycle. The end result is to drive up complexity and cost of providing the service. This same dynamic will begin to cause a real drag the internet as the cost and complexity required for security increase. The basic reality is that these substations were not built for an atmosphere of intentional attack, and their location and security provisions are more targeted at keeping out casual vandals. It would be mighty difficult to upgrade their security to account for any kind of widespread attack.

The basic reality is that these substations were not built for an atmosphere of intentional attack, and their location and security provisions are more targeted at keeping out casual vandals.

Department of Homeland Security worries about that, at least with respect to recovery after the fact. A few years ago they did a presentation at an ASPO conference covering a "war game" exercise for a bunch of decision makers with a scenario where terrorists had taken out all of the transformers used to deliver power to one of the "C" cities in Ohio (don't remember exactly which). Only a handful of big transformers had to be disabled to cut the city off from the grid. As I recall, the speaker said that ramming even the biggest of them with a stolen garbage truck was sufficient to ruin them, and physical security was not adequate to prevent that.

Yeah, there are some I've driven by, and I look at them and think about how hard it would be to protect them vs. how simple it would be to do serious damage, with only a basic knowledge of what to go after. As hard as it must be to deal with the cybersecurity issues, I would not want to be in charge of physical security. They were built for a different world when they were symbols of growth and prosperity - that was their main protection. What happens in a some future scenario with real widespread social unrest and organized groups competing for power? And then it's not just the substations, by definition the lines and towers stretch across the land. How can it be possible to protect them? The only possibility is that all parties see them as an asset to be protected.

This is another reason that I advocate decentralized power generation.

BTW you can put a few bullets through a solar panel and it will still produce electricity and you won't have a toxic cleanup to worry about.

The more we as a society facilitate people becoming grid independent and installing solar with battery backup systems, even if they are still connected to the grid the more 'Anti Fragile' we all become!

People who still try the to push the lame argument that solar is too expensive, intermittent and unreliable are not looking at the full costs and vulnerabilities of the systems we currently depend on...

This is the type of terrorism I've been expecting for a long time now, and am frankly surprised there haven't been more attacks on infrastructure. It's a better strategy than shootings or bombings (for those that want to bring down the system), because it goes directly after BAU.

Well, it depends on what you want to accomplish. You probably can't find a person that has not heard about the Boston bombing . . . but you probably can't find more than a handful of people that have heard about this San Jose attack. I didn't even know it was an attack until just now and I live here.

Agreed, Earl. This is much more alarming than most stories today. And, if it becomes widespread, as you (and I) expect, will have far ranging impact on all of us.

Plus, the suspects could include folks from about any faction...


It's been an extreme concern for me as well. Modern society requires a very high level of societal stability. If you wind up breeding a bunch of people who decide to pull the plug - it'd only take a handful of people in every town to take it all down.

On TYT Cenk Uygur made an interesting comment during the Dorner man hunt. We kind of laugh a bit at the idea of some armed group of nutters in the woods - but if one guy caused that much trouble, can you imagine a group of 20, 50, or 100 Dorners?

April 19 might prove interesting. Ruby Ridge still resonates in many individuals synapses.

New from Congressional Research Service [CRS]...

“Hollowing Out” in U.S. Manufacturing: Analysis and Issues for Congress

Recent data challenge the belief that the manufacturing sector, taken as a whole, will continue to flourish.

Unlike previous expansions, the two most recent cyclical upturns in the U.S. economy have generated few jobs in manufacturing. Moreover, statistics suggest that domestic value represents a diminishing share of the value of U.S. factory output.

One interpretation of these data is that manufacturing is “hollowing out” as companies undertake a larger proportion of their high-value work abroad. These developments raise the question of whether the United States will continue to generate highly skilled, high-wage jobs related to advanced manufacturing.

Better Computer Models Needed for Mega Wind Farms

With wind power getting cheaper, wind farm developers are drawing up plans for farms an order of magnitude bigger than anything around today, some with more than 1,000 turbines. But there’s one big problem: the economics of wind farms depends on accurate predictions of power output, and it is far more difficult to model how such large wind farms will behave.

... About five years ago, poor data gathering and ineffective computer models meant wind developers were prone to overestimating the energy production of their farms by over 10 percent, enough to destroy profits and in some cases prevent them from making loan repayments. Models have improved, but the jump to larger wind farms, and the increasing prevalence of ordinary wind farms built close enough together to interfere with each other, is raising the issue again.

One problem with the current models is they don’t accurately represent the variability of wind, not just at ground level, but even hundreds of meters above the level of wind turbines. Recent research suggests that in some weather conditions, “models can dramatically underestimate wake losses,” says Michael Drunsic, senior consultant at DNV KEMA, which helps developers estimate wind power production. “The wakes carry a lot further than previously estimated,” he says. This isn’t a big problem in wind farms that have only one row—such as those that follow ridges. But with large wind farms with multiple rows, the longer wakes could affect many wind turbines, lowering their output.

Should it not be obvious that if you take energy out of wind, and allow some extra for entropy, that you will reduce the amount of energy in the wind?

I don't think that is the issue (not knowing), the issue is knowing the extent of the effect -how far down wind loses X percent of windpower etc. So they were using some simplistic model, and it turns out nature is tougher than the model.
So maybe you expected your downwind row of turbines to deliver 90% of what the upstream row does, and it turns out it only does 80%. Now all your carefully negotiated finances could fall apart.

To Reinvigorate Production, Alaska Grants a Tax Break to Oil Companies

Ugh. Although Alaska may be an exception if they need to do it to keep the pipeline flowing, in general this is TERRIBLE policy. All you are doing is giving a tax-break to an enormously profitable industry in order to 'bring forward' some oil that would have been extracted eventually anyway. It is just stealing from the future.

It is the pay-day loan of oil policy.

Although Alaska may be an exception if they need to do it to keep the pipeline flowing, in general this is TERRIBLE policy. All you are doing is giving a tax-break to an enormously profitable industry in order to 'bring forward' some oil that would have been extracted eventually anyway.

Yup, it is terrible policy. As I have posted numerous times before, while TAPS flow is declining, it is nowhere near close to shutdown. XOM, COP, and BP have been working on this for years, spending huge amounts of cash (at least by local standards) to elect friendly legislators. A great deal for the big oil companies, for Alaska not so much.

I wonder when they'll go after the Alaska "Permanent" Fund...y'know, get rid of all those moochers - "takers" - mooching at the teat of "makers" and "job creators." Alaskan welfare queens getting a big check for doing nothing.

I had a chance to keep tabs on quite a bit of the SB 21 process and was in contact with a few legislators throughout. Pretty much closing the barn door after the horse was gone stuff I (and likely others) suggested did get worked in in the end (such as phasing out the production tax credit as prices achieve certain levels and getting the high side of that credit back to $5 after oil companies' posse managed to move it up to $8/bbl) so I understand but I haven't actually had the stomach to even look at the final product yet.

It was quite the smoke and mirror show early on as oil companies and executive branch departments trotted out their charts to the various senate committees. I noticed the phrasing was more careful by the time the presenters were in front of the final committee, House Finance. I'm guessing more than one citizen called legislators attention to some of what was going down.

But near the end of the process PFC Energy, supposedly the legislature's hired hand, made the most blatant slip up when going through the financial impact of one of the bill's versions on oil companies. At least twice while showing what the oil company percentage take would be he said 'we' would be getting such and such. Quite the balanced analysis the taxing agency (the state of Alaska) must be getting from its hired hand British analyst when he says 'we' while referring to oil company take after taxes.

ConocoPhillips Alaska operations head was the most straightforward when in front of committee but the legislators had their partisan ears on so the majority didn't appear to understand how significant his comment on his company's need to invest money where it had a best chance of hitting an big a reserve addition jackpot was. ConocoPhillips has a heck of good handle on just how much reserve addition it will get by sinking just about any set amount of capital into its North Slope legacy production units given the cost of the technical options at a given moment in time. No great big hidden jackpots up in those fields from what I have been given to understand, or am I mistaken--that is your forte I believe.

The Gross Revenue Exclusion provisions for legacy fields that the legislature added to the governor's gift may have been the most egregious insult of process. No one ever made any case for why the state would want more of the oil from legacy field production units pumped sooner at a discounted take of a lower market price than later at a full take of a very likely higher market prices.

It did seem ACES unbracketed progressivity did provide unintended production disincentives as prices went north of $100/bbl. Why wasn't dealt with when back in the Palin days when ACES passed? Were the seeds of ACES destruction intentionally sown at the outset? I've no inside track on that. But what we just got could have been written in a Houston or London board room.

We Will Never See Cheap Oil Again

Doesn't $2.50 per gallon for gasoline sound just dandy? During the 2012 presidential race, a couple candidates used that number as a way of showing how increased American production would lead to lower prices and higher energy security. The problem is, though, that despite the increase in production in the U.S., cheap gas and cheap oil will more than likely remain a pipe dream.

Let's look at why oil prices will remain high despite our best efforts. ...

Doesn't $2.50 per gallon for gasoline sound just dandy?

Seraph, people would be all smiles if it even got to $3.00.

Court Limits Alien Tort Law in Shell Oil Case

WASHINGTON—The Supreme Court said Wednesday that a centuries-old statute making international law enforceable in U.S. federal court cannot be applied to actions that take place overseas, blunting a tool human rights groups had used against torturers and other abusers for violations in their home countries.

In an opinion by Chief Justice John Roberts, the court held that the Alien Tort Claims Act, adopted in 1789 shortly after Congress met for the first time, only applies to actions that take place in the U.S. While all justices voted to dismiss the suit against Royal Dutch Shell. Justice Stephen Breyer, joined by three other liberals, disputed the bright line majority conservatives drew.

In past decades, victims of former officials of foreign governments have won judgments in federal courts against their abusers. Those rarely have been paid, however, and more recently human-rights advocates have pursued deeper pocketed defendants, such as corporations doing business in countries with questionable regimes, under a theory that they are complicit in the misconduct.

The Supreme Court's ruling Wednesday will close off many such suits.

Tullow Oil and Northern Petroleum on the slide after Guyane update

Northern says exploration will drill deeper after finding no signs of hydrocarbons initially

Tullow Oil shares have slid almost 10% after an update from its joint venture in French Guiana.

One of its partners Northern Petroleum announced that an exploration well on the Guyane Maritime permit would drill deeper after no hydrocarbons were found in the initial campaign.

Northern's managing director Derek Musgrove said:

Whilst the sand package in the primary target proved not to have significant hydrocarbons at this location, the oil staining, encountered... is encouraging of the broader active hydrocarbon systems and potential.

I have some oil stained jeans. Maybe I can lease them out???


There are plenty of jeans with embedded oil, so let's not jump to conclusions that this in any way infers peak oil.

Northern says exploration will drill deeper after finding no signs of hydrocarbons initially

"Drill deeper, Baby, Drill deeper"

The Fed's Bullard thinks inflation is dangerously low

Cue the flashback to summer 2010. Ben Bernanke and other officials at the Federal Reserve were warning that inflation was approaching dangerous lows, perhaps even flirting with the dreaded "D" word -- deflation. Bernanke gave a key speech in Jackson Hole that August hinting that more Fed stimulus might be in the pipeline. Sure enough, it was. The Fed launched QE2 about two months later.

A similar murmur is starting up again: Could inflation be getting too low? St. Louis Fed President James Bullard thinks so.

these economic "news" are really somehow funny.

The Federal Reserve usually aims to keep inflation around 2% a year

why would 2% be optimal? from what point of view? which are the underlying assumptions
that 2% is optimal? does it mean that economy grows at 3% and energy consumption
grows in a "healthy" way and fracking makes usa energy "independent" and ...

From what the article says...it sounds almost like a form of demurrage. They're worried that people will save instead of spend their money if inflation isn't high enough.

It's reminding me more and more of Japan, and their 20-year battle with deflation. That's what happens after a bubble bursts. You don't get the quick rebound you get after an ordinary recession.


It's reminding me more and more of Japan, and their 20-year battle with deflation.

this is also kind of funny. why should one battle with deflation.
because economic growth is good and deflation is somehow opposed to it.
in any economic "news" growth of anything is good, so the discussion
is structured such as anything which hinders growth is automatically bad.
(whatever the definition of growth)

what should the japanese do. perhaps they should grow their
economy "robustly and sustainably" like chinese. this would surely
help them win the battle.


In the long run, it is often assumed that 0% inflation would work. Wages/prices would adjust to reflect the increase/decrease in NGDP and markets would clear.

where is it actually assumed that 0% inflation would work? in what kind of society? and that gdp could in fact decrease?!
maybe in some textbooks of economics, but here in real life i don't recall any such discussion...


jukka, why won't something lower (e.g. 1%) be a better target?

but why should this particular target be a better one?
i think this discussion about the "right" amount of inflation
doesn't really make sense precisely because the underlying assumptions
are not stated explicitly.

Jukka, my apologies, of course I meant "in theory". Where theory defines the long run as the period of time over which the adjustments can be made. Of course the rest of my post discussed why this "in theory" breaks down: 1. nominal ridgities can be prolonged and as Keynes said when addressing this topic "in the long run we're all dead" and 2. mis-allocations in the short run can lead to new long run equilibrium that are sub-optimal.

So i'm pretty sure we don't disagree.

Seems the US and Japan are the only markets climbing this yr.

A Year-To-Date Look At The World

Denninger cites that the FEDs mandate is "stable prices" and they have adopted a 2% inflation target as the manifestation of that mandate.

Anyone with a decent calculator can see what 2% inflation does - to a dollar - over 10, 20, 30 years especially when compared to earning power over the same period of time.

Will leave the bizarro subject of how "official" inflation is calculated along with CPI, chained CPI, etc.

I tend to agree that stable does not mean 2%. Frankly I think a little deflation in medical and higher education - as examples - might be welcome.


What do you think Rockman?

Pete, the FED has a "dual" mandate (maximum employment and stable prices)from the Federal Reserve Act:

"The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy's long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices and moderate long-term interest rates."

The problem is when the economy can't grow anymore in real terms due to resource constraints, then the dual mandate can't be met (with a 40 hour work week). Maximum employment (with no change in work week) requires high consumption of resources. If the economy can't provide additional resources, then prices can't remain stable, over the medium to long run.

Note that the Fed mandate refers to "growth of the monetary and credit aggregates commensurate with the economy's long run potential to increase production".

If a lack of resources reduces the "economy's long run potential", then the Fed is only mandated to maintain whatever growth remains possible, if any.

In the long run, of course, solar and wind resources are far larger than humanity needs. Our real problem is keeping carbon in the ground.

Good point. But also note, "... so as to promote effectively the goals of maximum employment, stable prices and moderate long-term interest rates."

There's a problem there because if the economy can't grow anymore, but the money supply continues to grow exponentially, which by definition it must if there is interest in the system (unless there is a succession of major deflationary crashes that destroy money, which then we wouldn't be maintaining maximum employment or stable prices), then those stated goals are incompatible with each other. The Federal Reserve Act is therefore fundamentally flawed.

As to, "In the long run, of course, solar and wind resources are far larger than humanity needs", theoretically, yes, solar provides vast opportunities for energy capture (wind is somewhat more constrained; realistically I don't think it could even supply enough energy to replace our current use rates), but the problem is twofold:

1) There is no way they can ramp up fast enough, and our infrastructure convert over fast enough, to prevent a major global crash. Will solar then subsequently ramp up to save humanity from a global die-off after the economic crash? Possibly. I think technically, yes it's possible. From a political and social perspective, however, based on what I've seen so far of human behaviour, then no. But I will try to remain optimistic and hope for a radical shift in public attitude towards our problems.

2) The bigger problem, however, is that the planet is limited in how much food it can produce, regardless of how much energy we have available. Unfortunately you can't eat electricity, and despite all of our modern advances and copious amounts of energy available to us up until this point, we have been unable to maintain the planet's total food production capacity at historical levels. It's actually gone down 10% (if you define "food production" as the total amount of vegetation grown on the planet). And we are nearing maximum food harvest limits today. Therefore, it doesn't matter how much electricity we produce from solar panels, it simply won't be possible to provide western style diets for everyone, and when energy decline really swings into action, we will not likely be able to feed the world. Unfortunately, it is our fate that a very significant proportion of the world's population will be destined to remain in poverty; the resources simply aren't there to support otherwise, regardless of how many solar panels people put on their roofs.

The Conservative party in the Canadian province of Ontario will be tabling a private member's bill tomorrow which stipulates that, if renewable energy is to be sold to the grid, it must be at the same price or lower than energy made from non-renewable energy. In other words, increasingly polluting, non-renewable energy that contributes to global warming is worthy of a premium.

Meanwhile the federal Conservative party has just removed references to 'Environment Canada' from its popular weather forecast site.

My heart aches for humanity.

Yes, I knew it would be bad when they won the election; considering we have so much of the world's remaining oil (which only amounts to 10 years at that), what we do with it could make or break humanity. Funny how the difference between majority or minority government in the Canadian parliament could have such a profound impact on the future of our species. We are moving down a very dark path and these bozos are so blinded by their religious ideology that they are clueless to the effects of their policies. They blame running out of resources on those who are pointing out that we are running out of resources, i.e. environmentalists

Same dynamic south of the 49th parallel. Only we are an order of magnitude bigger (even if not in oil), so our effect on the world is even bigger. Energy/environment wise it seems there is no difference between Canadian and US conservatives.

if renewable energy is to be sold to the grid, it must be at the same price or lower than energy made from non-renewable energy.

They must have gone to the same school as this guy from Kansas...

“we don’t have laws in Kansas right now that relate to sustainable
development.” It’s more about preventing sustainable development in the
future. "
Dennis Hedke, Geophysicist

I truly hope I live to see the day when people like these are finally held accountable, for their greed, stupidity, and lack of foresight! Perhaps we could bring back the old practice of displaying them in stocks on the public square where we can all go and spit in their faces.

I was about to make the same comparison.. but really, I think it's just another sign of their desperate bargaining to try to redefine things as they WANT them. You know when they start attacking market principles and setting prices that they are on the back foot and toppling.

But still, I can't expect we'll get our comeuppance, either. Any 'I told you so's' coming out of all this will probably be hollow at best, or even disastrous.

'The best revenge is to live well and be happy.'
(Oh, Bother, I have to say it.. and 'Live Well' doesn't mean amid BAU Excesses.)

Let's say I want to build a house that uses zero net energy. Most people would probably say that is sustainable. I guess that would be prohibited in the future. Better to build a house that uses as much energy as possible so that ... What?

Of course there is also the issue that sustainability can be a pretty subjective concept. Further, one might argue that, generally speaking, sustainable development is an oxymoron.

" I guess that would be prohibited in the future."

Most folks in the US draw a pretty hard line between what we do as individuals and what we expect the rest of our society to do. It's very much a "Don't tread on me" thing. I was surprised how threatened some people got when I decided to not connect to the grid,, until I started referring to it as a 'hobby'. At least my hobby doesn't include fouling their air and water, etc., unlike their lifestyle.

That's a great observation. So much of it is in the conscious framing of it.. ("It's ALL in the presentation.." Oskar Schindler)

I've often toyed with the thought of putting up my renewable energy stuff as really tasteless, brightly colored Lawn Art.. that way, I can couch it within the unimpeachable rights to keep my own ridiculous opinions and tastes and express them loudly, even when my real and provable engineering goals would be considered far too subversive and suspicious.

Luckily, I have reasonable neighbors, so I don't have to test this theory, yet.

I was surprised how threatened some people got when I decided to not connect to the grid,

It surprises me not in the least! You were threatening their paradigm at a most fundamental level by concrete example... you are lucky they didn't burn you at the stake >;-)

People who manage to intervene in systems at the level of paradigm hit a leverage point that totally transforms systems.

You could say paradigms are harder to change than anything else about a system, and therefore this item should be lowest on the list, not the highest. But there's nothing physical or expensive or even slow about paradigm change. In a single individual it can happen in a millisecond. All it takes is a click in the mind, a new way of seeing.

Of course individuals and societies do resist challenges to their paradigm harder than they resist any other kind of change.

Leverage Points, Donella Meadows

"But there's nothing physical or expensive or even slow about paradigm change. In a single individual it can happen in a millisecond. All it takes is a click in the mind, a new way of seeing."

-- a reworking of the neuronal connections, which is often quite uncomfortable for people, which is why most resist it, leading to strange behaviour like cognitive dissonance, etc. The more ingrained the false belief system, and the more radical the paradigm shift needed to correct it, the more people resist, and the more disruptive the change will ultimately be.

People can believe a dozen different things which conflict with each other, and which make no sense. They can change their minds on a dime.

Most people haven't deeply absorbed ideas about energy or climate change, they're simply following their leaders. If the leaders change the message, they'll follow.

And who are the leaders of "most people"? It only takes a few well funded advertisements to discredit political leaders, e.g. Carter and his energy conserving cardigan sweater. It seems our real leaders are determined by a few plutocrats, and they are not likely to change their message to be in any way beneficial to all of mankind.

Yes, the problem seems to be a very tiny minority.

OTOH, those people can't completely insulate themselves from the rest of the world, try as they might. Their kids will bug them, their business associates will begin to politely introduce different ideas on the golf course (maybe just when they've had one too many), their schools will begin to put things in the alumni publications...

So, BAU will automatically save us? ROTFLMAO!

No, not at all. I'm just pointing out a few bits of hope. Things can change, and it can be faster than one thinks.

We have a chaotic (in the sense of chaos theory) society, led by a small minority. That can lead to extended paralysis, or very fast change.

We can make a difference with communication between ourselves, our friends, our sphere of influence, our representatives, our tribes, etc.

Have you sent your elected reps $50 and a request to vote for renewable energy??

"Have you sent your elected reps $50 and a request to vote for renewable energy??"

Yeah, Nick, I did that. A couple of years later he left Congress and took a lobbying job with Duke Energy. We now have a pro-growth, pro-BAU repug taking his place.

Some of the folks I started our community garden with talked the talk about changing things, etc. They dropped out this year saying "it's too hard,, this change thing, growing food and all." They bought a boat; want to spend time boating... I could go on about how, locally, our leaders have made it even harder to install PV because too many folks were complaining about it "spoiling the view and driving down propety values." A drive to get the local super-grocer to turn down it's obscene lights at night 'because it spoiled the view of the night sky" failed miserably.

I'm not sure you grok how much inertia and delusion our idiocracy has built up. All of the things you suggest look good on paper, but considering how far politics and finance have gotten off track in our society, accomplishing these things is only likely to happen after a series of extremely painful wake up calls.The systems you hope to correct are hopelessly beyond repair. The time for incremental changes to begin passed us by decades ago. Very few have noticed that inflection points have been reached and ignored.

The problem is the system has an enormous amount of inertia. Even if you had the best people running it, who were incredibly well-informed, incredibly public-spirited and prepared to do something about it, the system has so much inertia that they wouldn’t be able to achieve anything in the amount of time that there is available. So you simply are in a position where the system as it exists is unreformable, and in fact there has been comprehensive regulatory capture, so the rules are written by the very people who benefit from them the most. And these are the people least likely to go changing the status quo, because it has served them so well and often they can’t see that it wouldn’t serve them exactly the same way in the future (even though I don’t think it will, but they think it will). So why would they reform that?

We actually do not have a democratic process. In most developed countries, what we have is the appearance of democracy, we have the institutions, but they have been hollowed out and they no longer serve the functions in the way that they once did. So, comprehensive regulatory capture – and most of what passes for politics these days is political theatre, or prolefeed, if you like, in Orwellian terms, so this is not the ability of ordinary people to actually generate change at the political level. I think those days are gone, and they have been gone for quite a long time, so we’re not in a position to be able to vote for that kind of change.


No, I get it. Social change is a very big problem.

The key thing to me is the problem of plutocracy - our society being run by a small group of delusional wealthy people, who buy our representatives and run our media.

This isn't an easy problem, but the fact that this group is small does say that there is the potential for dramatic change if something catalyzes it.

What might cause that? I don't know, but I know that these people can't really live on an island, even if they try sometimes, so they can be reached. If everyone in the intellectual/professinal middle class were to change their viewpoint, that elite group would be affected.

Also, I think that our reps could be purchased back by enough people with small contributions, and that voting really does work, if enough people get it. Of course, the media control thing gets in the way of that, which brings us back to the key problem of cracking into the echo-chamber of delusional thinking of the wealthy...

If enough people send $50 I suppose that could buy a congressperson. How would that create leadership?

And having established that it is all right to buy a congressperson, what moral argument do we have when s/he switches to a lobby that pays more than we can?

Oh, that's not a strategy for creating leadership. I'd vastly prefer publicly financed elections, a separation of commerce & state, etc.

I'm just saying: FF industries (among others) are buying congresscritters. Shouldn't we put in a bid?

FF industries (among others) are buying congresscritters. Shouldn't we put in a bid?

And as it turns out, I've seen some issues (California propositions), where it was big money versus the little guys. And the big money outspent the little guys by more than ten to one, but the little guys won. Sometimes you don't have to overwhelm the other guys money and messaging system, you just have to show up and make enough noise (buy some adds. etc.) to be heard. So we shouldn't just roll over and play dead. But, we shouldn't have unreasonable expectations either.

Good points.

There are diminishing returns to the money spent on misinformation.

And, you can't take anything for granted - the "bad guys" are wily!

But, to a degree that surprises me, more and more people are "getting it". Things I would say that were considered crackpot ideas a couple of years back are now almost mainstream. Like the fact that our democracy has been hijacked by the 1% for their own benefit. More and more are figuring out the con. Does this mean we can escape it?

"Does this mean we can escape it?"

It depends on what you mean by 'we' and 'escape'. Collectively, there's no way humans can bargain or finesse their way out of their overshoot condition. That more people are "getting it" is good, but where's the sense of urgency, at scale?

The vast majority of the planet's population continues to blunder forward one day at a time. They are in symbiosis with a complex, systemic web of technology, global finance and biosystems all begging for fundamental change. We didn't 'build' these systems; they evolved, and will continue to do so out of our collective control. To insist otherwise seems like hubris to me. Most of us will certainly respond to what's ahead; undergo some dramatic changes, but a lot of forcing will be involved. Best get ahead of the curve.

The inertia of most people being pulled along by whichever systems they're committed to, immersed in, needs to be overcome at the same time these systems undergo changes we haven't begun to fathom. As Stoneleigh mentions in my link, above, we're witnessing limits to growth in virtually everything, and I would add, we've exceeded natural limits, are running deficits, on many of our most essential systems... corruption on a global scale.


I'm not even sure that getting it and intentionally withdrawing from that system and building as much self-reliance as possible will help. When one is a product of and surrounded by a large society that is collapsing, it's pretty hard to keep from getting caught up in it.

Written by Nick:
Have you sent your elected reps $50 and a request to vote for renewable energy?

I did that with some choice candidates, but they all lost their elections.

Good for you. I suspect many readers on TOD haven't.

We don't have enough people doing that yet...

Ontario's Green Energy program has been badly mismanaged so it should not be a surprise that there has been a backlash against it. The primary goal of the program was to create jobs -- not to reduce CO2 emissions. Our Liberal government is also heavily focused on new highway construction so they clearly don't get Peak Oil and Climate Change. The government doesn't seem to care about the cost of green energy as there seems to be little effort placed on keeping the feed in tarifs in line with costs. The cost of PV installations has fallen significantly to the point that it is reaching grid parity in some locations but in Ontario we're still signing new 20 year contracts for $.40 per Kwh. It is as if the green energy industry has been able to dictate to the government what the tarif levels should be. The government makes the claim that the Green Energy program is driving the phase out of coal generation. That's a big exageration -- the construction of gas fired generators, refurbishment of nuclear reactors that had been out of service and the reduced demand for electricity due to Ontario's deteriorating economy are the real reasons why we are generating far less power with coal.

the money supply continues to grow exponentially, which by definition it must if there is interest in the system

That doesn't make sense to me. Why must the money supply increase, just because of interest? Interest rates can go to zero.

There is no way they can ramp up fast enough, and our infrastructure convert over fast enough, to prevent a major global crash.

How do you come to that conclusion? Keep in mind that solar and wind is already displacing coal and NG consumption. I see no sign that we'll run out of coal or NG before we can ramp up wind/solar. Our primary problem is too much FF, not too little.

it simply won't be possible to provide western style diets for everyone

But why is a diet dominated by meat production essential???

The money supply must increase in size to provide more money to service the growth in the previous money due to interest, or the system falls apart.

"Zero percent" interest rates are not sustainable for any length of time. Furthermore, that's just the Fed's rate. The banking system marks rates up to about 3% or more. It's simple arithmetic: any monetary system that has an exponential growth component is not compatible with a finite economy.

"How do you come to that conclusion? Keep in mind that solar and wind is already displacing coal and NG consumption."

Except that due to the sheer magnitude of the energy supply, increases in coal and NG are way above increases in PV. Of course, if you continue the recent exponential trends in PV / wind growth then of course it will replace all our energy needs in only 15 years! Wow! Problem solved! But we cannot expect those exponential trends to continue, especially considering the economic carnage soon to envelop the world. And we cannot switch over the infrastructure to accept this new energy source in anywhere near that short amount of time.

"Our primary problem is too much FF, not too little." This statement is just nonsense, have you been paying no attention to basically every single post on TOD which shows that oil production has not increased in what is it, 8 years now? Please provide a figure for the proportion of the transportation fleet that runs off oil, versus electric. What are the current production rates for EV's, in proportion to the total vehicle fleet? What percentage of global energy supply do wind and solar contribute?

"But why is a diet dominated by meat production essential?"

OK, then you try to convince the world not to eat meat before they're forced to eat less because the world is starving. Most people won't even admit that we are even subject to growth limitations at all, let alone that we are well beyond them now, and beyond this, that they have to voluntarily give up eating meat. Good luck with that one...

"Zero percent" interest rates are not sustainable for any length of time.

Why not? Japan is doing it.

The banking system marks rates up to about 3% or more.

Well, if inflation is expected to be around 2-2.5%, that's a pretty low effective rate.

any monetary system that has an exponential growth component is not compatible with a finite economy.

That assumes the premise. How does our current monetary system have a *necessary* exponential growth component?

increases in coal and NG are way above increases in PV.

I think wind/solar are larger than you think. Let me steal from Ulenspiegel:

High noon in Germany (12 o'clock data from agora-energiewende):

wind power 16.9 GW
PV 19.2 GW
hydro 2.4 GW
biomass 3.8 GW

conventional 33.9 GW

sum 76.2 GW, of which are 42.3 GW renewables.

German demand ~68 GW
export ~ 8 GW

Until now no complaints due to net instabilities.

we cannot expect those exponential trends to continue, especially considering the economic carnage soon to envelop the world.

Again, that's circular.

"economic growth is over, because renewables can't scale".

"renewables can't scale, because growth is over".

every single post on TOD which shows that oil production has not increased in what is it, 8 years now?

FF is a lot larger than oil. Have you been reading the posts abouts coal??

What are the current production rates for EV's, in proportion to the total vehicle fleet?

About 4% of US vehicle sales are partial electric hybrids, about .3% are pure EV. Those numbers can scale pretty quickly.

you try to convince the world not to eat meat before they're forced to eat less because the world is starving.

There's as much obesity in the world as there is malnutrition. Scarcity isn't the problem, yet. If that begins to change, then one of the questions becomes "why meat?".

Of course, you might want to tackle the 40% of the world's food supply that's wasted, first.

It's always fun debating with Nick, he seems to focus more on pulling up partially irrelevant tidbits of selective data and flawed arguments to try to defend his previous statements rather than actually considering the points being made.


"Japan is doing it."
Japan has by far the largest debt to GDP ratio in the world. It's a basket case waiting to happen. Have you not heard that they are now officially embarking on printing up $1.5 trillion to buy government debt, to target for a 2% inflation rate? A "2%" rate on anything is exponential.

"if inflation is expected to be around 2-2.5%, that's a pretty low effective rate."
It doesn't matter how low it is, as long as it is a consistent % growth per year, then it is an exponential system and it will, eventually, go vertical and collapse.

"High noon in Germany (12 o'clock data from agora-energiewende):
wind power 16.9 GW
PV 19.2 GW
hydro 2.4 GW
biomass 3.8 GW
conventional 33.9 GW"
That's fantastic, and my hat goes off to Germany. I was hoping for a global figure, however. Nice attempt to skirt the question.

"Again, that's circular"
How so? It's not at all circular. You need energy and resources (and time) to build out the massive infrastructure required to move over to renewables, and unfortunately we are running out of energy and resources (and time). Renewables are a tiny portion of this. And any increase in coal and NG go disproportionally to building out more FF based infrastructure rather than renewables, on a global scale.

"FF is a lot larger than oil. Have you been reading the posts abouts coal?" How many cars can run off coal? (directly driven by coal, not coal fired EV electricity generation). How many coal-to-oil plants are there in the world?

"about .3% are pure EV"
Well there you go.

"Those numbers can scale pretty quickly."
Requires energy, resources, time, and capital investment, all of which we are running out of.

"There's as much obesity in the world as there is malnutrition. Scarcity isn't the problem, yet."
That is such an oversimplification of the problem it's meaningless. Firstly, go to Africa and convince a billion people that food scarcity isn't a problem -- typical Canadian / westerner tunnel vision. Secondly, in effect, obesity is a from of malnutrition. It's a symptom of poverty and social decay where people don't have the means to properly educate themselves about food, or the money to buy the more expensive wholesome food. That junk food is highly dependent on fossil fuel energy subsidies.

If enough obese North Americans go to Africa it could do a lot to alleviate hunger there.


These points aren't irrelevant. They're illuminating, but only if you have an open mind.

Japan: yes, they don't like zero growth. That's not the point: they've had pretty close to zero growth for 20 years, along with zero interest rates, and they haven't collapsed. Yes, they're trying to create inflation, in order to create growth, and yes, they've created quite a bit of debt in the process. Fortunately, that debt is all owed by Japanese to Japanese, and denominated in Yen. Not really that big a deal.

It doesn't matter how low it is

Sure it does. We don't have zero growth now, so we don't have many examples of zero interest rates over a long period. So, we have to look at the closest we've got. And, again, why does interest demand growth? Why can't it just be a transfer from debtors to lenders? If you lend $100 to your brother, and he pays you a buck every year forever, that $100 won't grow. Call it interest, call it rent, call it a sibling tax, it doesn't
demand growth.

I was hoping for a global figure, however.

That's not that hard. Wind power market penetration is expected to reach 3.35 percent by 2013 and 8 percent by 2018 http://en.wikipedia.org/wiki/Wind_power

Solar looks it will get to about 150GWp this year, which is roughly 22MW, or about 1% of world electricity, and growing very fast, as it's reached grid parity in many places: http://en.wikipedia.org/wiki/Solar_power_by_country

we are running out of energy and resources (and time).

Well, no, we aren't. That's the point.

Requires energy, resources, time, and capital investment, all of which we are running out of.

No, we're not. We may be running out of time before Climate Change becomes irreversible, but we're not running out of energy, resources or capital.

go to Africa and convince a billion people that food scarcity isn't a problem

Talk to the farmers put out of business by US/European food priced under production costs. Africa used to be a food exporter. Too-cheap imports put them out of business, and now that food prices are rising to the cost of production developing countries are being hurt by their import dependence. Tho import rices are still low, just not low enough for the very poor.

obesity is a from of malnutrition

It's too many calories. It may also be accompanied by too few micronutrients, but McDonalds actually does ok there. No, there's way too much cheap food.

That junk food is highly dependent on fossil fuel energy subsidies.

No, it's not. Farms can and will run out without FF, though they'll probably be among the last places to phase them out, due to their convenience for intensive seasonal operations.

Certainly true about obesity. In the developed world, BMI is anti-correlated with income. Poor people optimize calories per buck, and buy lots of cheap sugary stuff. Richer people, can afford to buy quality food -being able to afford enough calories isn't an issue with them.

It's complicated. A few thoughts:

Really healthy restaurant food is hard to buy at almost any price - the leisure required to cook at home tends to come with affluence. OTOH, it's not impossible, if you choose the one relatively healthy item on the menu.

And, there's culture - thinness is highly fashionable among the wealthy, often not at all with people of lower income.

the money supply continues to grow exponentially, which by definition it must if there is interest in the system

That doesn't make sense to me. Why must the money supply increase, just because of interest? Interest rates can go to zero.

There's no incentive to lend if (nominal) interest rates are zero. However, it's perfectly possible for a system with a fixed money supply to support non-zero interest rates, and it can make good sense (e.g., buy a $100k house for $200k over 20 years instead of taking 20 years to save that $100k while renting).

Indeed, I would expect this to be common, as young people borrow against their future (usually higher) earnings, while old people lend their accumulated savings to provide retirement income.

There is no way they can ramp up fast enough, and our infrastructure convert over fast enough, to prevent a major global crash.

How do you come to that conclusion? Keep in mind that solar and wind is already displacing coal and NG consumption. I see no sign that we'll run out of coal or NG before we can ramp up wind/solar.

Moreover, I think many people overestimate the size of the problem relative to what is possible. Adding enough wind&solar to completely replace all current electricity generation (world-wide) would only take an amount of manufacturing equivalent to about 15 months of world manufacturing capacity.

It couldn't be done in 15 months, of course, but that does give a reasonable estimate of the size of the problem, and it suggests that even rapid deployment -- 10 years, say -- would require only a modest fraction of manufacturing capacity, putting it below the level of economic transformation seen in the mobilization for WWII.

As a result, available evidence suggests that (a) the time available to change our infrastructure will be relatively long (a few decades), and (b) our infrastructure can be changed in a relatively short time if need be (under a decade).

There's no incentive to lend if (nominal) interest rates are zero.

How about 2% nominal, 2% inflation, 0% real rates?

young people borrow against their future (usually higher)

People who object to money supply growth seems to be assuming a zero-growth economy. That seems far in the future to me (labor productivity growth will continue for quite a while, for better (growth) or worse (structural unemployment), but that's the scenario being suggested, I think.

The Fed no longer pays much attention to the employment side of its dual mandate, as the tools that it used to have for affecting employment have largely disappeared. The Fed's fundamental power is the ability to make it cheaper for depository banks to loan money, so the banks will take more risks and make more loans.

Consider the situation in 1977, when the dual mandate was put into place. What could the banks do with that cheap money? Or more usefully, what couldn't they do? Mortgage standards generally kept them from loaning it to risky clients for home construction. Capital controls kept them from loaning it outside the country. Regulations left over from the Depression kept them from loaning it to people who were going to buy stocks, bonds or other securities. Basically, what they could do was loan it to business people whose plan was to expand or open a new business. And the state of automation at the time meant that expansion was going to require hiring new employees.

Today, loaning money to businesses so they can hire new people in the US is pretty far down on the banks' list in terms of risk/return.

There are a few different ways to look at it. I believe that what policy makers care about is nominal GDP growth (real GDP growth + inflation). Inflation is the chosen policy target because it is typically the easiest for the FED to munipulate. And when times are normal it is a good proxy for NGDP growth as the real economy has traditionally ticked along at 2-3%.

Now, In the long run, it is often assumed that 0% inflation would work. Wages/prices would adjust to reflect the increase/decrease in NGDP and markets would clear. However, the underlying assumptions you mention usually hinge on the notion of "sticky" wages/prices (prices to a lesser degree). In this case, people are less willing to reduce their pay. (this is often referred to as the "money illuision") The result is that a situation where the economy needs to adjust the quanity of resources allocated to a certain sector can only reach equilibrium via a reduction in output/hours worked, rather then also including hourly wages adjusting down (see Japan, in a sense their shrinking workforce has eased what would have been an even more stark failure of monetary policy). Thus exasperating the need to allocate resources out of the sector and the cycle continues.

So again, NGDP seems to be the important factor in determining how quickly an economy rebounds. Inflation's importance is in it's relationship to NGDP (and how easy it is to munipulate during 'normal' times). However, shooting for a 2% inflation whether RGDP is growing at -1% or 5% doesn't seem to make much sense to me. I'd like to see the fed target NGDP instead.

A small amount of inflation helps contain wage growth. It's real tough to tell an underperforming employee that their salary is being cut 2% each year. It's less tough to tell them that they aren't getting a raise and let inflation take 2% of their income away. With 2 or 3% inflation, you can give "cost of living" raises on average, but give good performer higher than CPI raises and pass over others.

why would 2% be optimal?

jukka, why won't something lower (e.g. 1%) be a better target?

Because that has always been the target zone; that and 5% unemployment.


Central bankers are terrified of deflation. Experience suggests that deflation, once started, is much harder to stop than inflation is. The central bankers are afraid that if they aim too close to zero (eg, 1%) and miss, they'll kick off a deflationary spiral. 2% gives them a little more margin for error.

Plus, they want people to have an incentive to take their cash from the mattress and invest it. 1% isn't much incentive.

The interest rate should be about 3.5% + the inflation rate, e.g. 4.5% if inflation is stable at 1%. The fact that it is far below that due to the Fed's intervention is a real problem for savers, who are getting a 0% inflation adjusted interest rate. The Fed is unsuccessful in its attempts to get people to spend on consumption and real investments in new businesses, instead of savings, and the excess cash is going into asset bubbles instead.

No question, investment isn't as high as desired. It's not zero, but savings need to be lower and investment needs to be higher.

The obvious choice for individuals and business: investments in energy cost savings, like efficiency, solar, EVs, etc.

As noted by Leanan, in a deflationary period, people just hang on to their money. There is the possibility, as occurred in the Great Depression, that this leads to an uncontrollable downward spiral in economic activity.

I think there is also an idea that the 2% target it allows downward adjustments in prices and costs to be gradually made by stealth - instead of cutting someone's pay, you just don't give them a raise or make it very small.

They're worried that people might actually save money instead of borrow and spend.

With QEi in place, and the rediscount rate at 0.25%, there isn't much more the Fed can do to gin up inflation, which is something they have, IMHO, been attempting for the last 8 years.

Think about what we would have in the absence of these stimulative features by the Fed.

I doubt that President Obama can talk the capitlist right into any more stimulus. Short of literally turning on the printing press and paying the US bills with new money, there isn't much left to do but wait for the crash.

The only real question today is what is keeping the economy afloat at all? I mean, the only part of the economy that is growing is FIRE, and they are sucking money out of the economy as fast as they can (though, it looks like the RE part is about done). Nothing left but parasites.

Oh, well. In the meantime, there may be a buck to be made...


"what is keeping the economy afloat?"

Zero percent interest rates. Continued trade deficit. Fed money printing. They are monetizing the federal debt and that inflation is being offset by deflation. They are buying assets like stocks using freshly printed money. The big banks use high frequency trading to keep indices within their desired range in a misguided belief that the wealth effect will be able to save us all from crumbling fundamentals.

Chris Martenson This Gold Slam is a Massive Wealth Transfer from Our Pockets to the Banks

Silverseek The Price Smash – Who, What, How and Why?

Said by St. Louis Fed President James Bullard:
"Inflation is pretty low right now, and it's been drifting down,"

The price of food is skyrocketing. From April 2009 to April 2013 crackers have risen from $.98 to $1.68 (14.4% annual). The price of bread has risen from $1.23 to $1.48 (4.7% annual) for a 24 ounce loaf. The problem is that the Bureau of Labor Statistics' CPI-U is too low to represent reality.

I wonder if his statement has anything to do with the the CPI-U increasing by +0.8% in February (not seasonally adjusted) or 9.6% on an annual basis. Maybe the tax hikes, drought and mortgage defaults have caused the Fed to lose control causing it to pretend to intentionally raise rates.

Maybe the price of all that junk people do not need is getting lower.

Anyone get any sense about what is going on with the ricin stuff? White House, Senate offices, House offices... In letters and packages from Tennessee, from what we have learned so far.


Officially no connection to the Boston Massacre.


It sounds like they know who's responsible. I'm guessing a lone nutter, probably very familiar to the secret service.

Local news (Bay area) [I was only peripherally listening -so I mighta misheard], thought it was a gun nut. They hit a local politico. Whether he is the same one that mailed the other letters probably isn't known yet. But, I think it would be a big coincidence if it was two independent attackers.

They arrested a guy named Paul Kevin Curtis.

Apparently, he makes his living as an Elvis impersonator.

And he's definitely a few french fries short of a Happy Meal.

Multiple online posts on various websites under the name Kevin Curtis refer to the conspiracy he claimed to uncover when working at a local hospital from 1998 to 2000.

The author wrote the conspiracy that began when he "discovered a refrigerator full of dismembered body parts & organs wrapped in plastic in the morgue of the largest non-metropolitan healthcare organization in the United States of America."

Curtis wrote that he was trying to "expose various parties within the government, FBI, police departments" for what he believed was "a conspiracy to ruin my reputation in the community as well as an ongoing effort to break down the foundation I worked more than 20 years to build in the country music scene."

I'd guess that this story would be a back page "odd news" deal, except for the Boston event throwing a spotlight on terrorism.

Similar to the anthrax letters after 911. I'm wondering if it's a phenomenon similar to multiple inventors coming up with similar ideas at the same time. Except this is multiple terrorists coming up with a similar idea (eg. attack the US system) at the same time. I notice above someone damaged a key substation in an attempted systems disruption attack.

It's strange how at key inflection or tipping points multiple unconnected events seem to occur. Bitcoin, gold, the stockmarket were all declining prior to the attacks and of course some pretty big earthquakes too. Possible nuclear war or catastrophic nuclear accident seems to be also providing something of a backdrop to events along with bird flu (Bird Flu discovered at [UK] Suffolk poultry farm).

I guess we can add the Texas fertiliser blast to the list.

The stockmarket will be interesting to watch over the next few weeks. If it falls, despite the massive amount of manipulation to underpin it, then its game over. Same if interest rates start to rise on government and corporate debt.

I'm guessing that's an accident. Fertilizer plants do have a tendency to explode. And Texas isn't exactly known for their tight regulations.

I'm guessing that's an accident

It sure looks like that. The following news item from Washington Post popped in my Google news feed Mayor: Firefighters went to fight fertilizer plant fire 30 minutes before blast

I am not posting the link.

Video clip linked on Drudge by a guy who was taping the fire (which preceded the blast), and who turned out to be way to close when the explosion occurred:


(Same link that Speculawyer posted.)

One of the most amazing pieces of video I have ever seen. This guy almost got himself and his family killed.

Methinks the best way to view fires at refineries, fertilizer plants, munitions plants, etc., is in the rear view mirror as you drive away, preferably in an upwind direction.

On the subject of getting people killed, that video was apparently taken from the parking lot of his daughter's middle school. There is also a nursing home in the immediate area.

The plant was supposed to be safe.

Guess they were wrong.

The fertilizer plant that exploded Wednesday night in West, Texas, reported to the Environmental Protection Agency and local public safety officials that it presented no risk of fire or explosion, documents show.

West Fertilizer Co. reported having as much as 54,000 pounds of anhydrous ammonia on hand in an emergency planning report required of facilities that use toxic or hazardous chemicals.

But the report, reviewed Wednesday night by The Dallas Morning News, stated “no” under fire or explosive risks. The worst possible scenario, the report said, would be a 10-minute release of ammonia gas that would kill or injure no one.

Kinda reminds me of BP, not planning for a major oil spill, because that would never happen.

IF ((business = 'fertiliser manufacture') AND (fire_explosive_risks='no')) THEN CALL(sack(assessor))

Suggest they run something like this over their risks database.

Anhydrous ammonia is not ammonium nitrate - not as dangerous, and far less likely to explode.

However, they apparently had some ammonium nitrate, too - which they did not declare on their risk management plan.

I spent a summer working in a chemical plant that had some very nasty chemicals and carried a risk of explosion. It was surrounded, on 3 sides, by houses, shops and a large school. One would ask why it was built so close to these. The answer, it was built on an old farm far from anyone. The rest were permitted to be built alongside it afterwards. One wonders why the council 'planning department' was called such.


I checked the situation here in Alberta. The Canadian Fertilizer Safety Council recommends a 1.5 km (1 mile) buffer zone between any fertilizer plant producing nitrogen fertilizers and any residential development.

The City of Medicine Hat which has the largest fertilizer plant in Canada within its city limits has a 3.2 km (2 mile) buffer zone between it and any residential development, while the City of Fort Saskatchewan, which has a huge chemical complex, insists on a 3.5 km (2.2 mile) buffer zone.

Their planners talk about "annoying doors" and "noise problems" but you can see they are really thinking, "What if the plant blows up?"

Medicine Hat is near the huge Suffield Military Testing Area, and I can remember when researchers there created the largest non-nuclear explosion in world history - using nitrogen fertilizer. City planners were no doubt taking note. Think, "small atomic bomb".

Not sure if this makes a difference...but it sounds like West Fertilizer wasn't actually producing any fertilizer. Rather, it was a storage and distribution center for the local farmers.

Check out the following

en dot wikipedia dot org slash wiki slash Ammonium_nitrate_disasters

You REALLY want to be careful storing that stuff.


No, it doesn't make much difference. Producing fertilizer is not very hazardous, it is the storage facilities that are dangerous. Storing nitrogen fertilizer is not much safer than storing dynamite - it produces just as much energy, it is not much harder to set off, and a hot fire is enough to make it go ka-boom. If you have thousands of tons of it sitting around, it is a very real hazard.

Judging from the delay from the view of the explosion to the arrival of the sound, he was about 200 m (560 feet) from the fertilizer plant.

Similar accidents happen every few years. The world goes on. For those not affected they are largely forgotten.

EIA Continental and World Crude Oil and Lease Condensate Productions January 2000 to December 2012

African production has dipped down during the last two years after slowly increasing. The reduction appears to be caused by geopolitical events in Egypt, Libya and Nigeria which suggests the reduction is temporary.

Central and South American production is slowly increasing.

Eurasian production is dominated by Russia and is slowly increasing but appears to be nearing a peak.

European production has been decreasing since 2002 and is currently about half of what it was then. There has been no price response in that region even after price rose above $100 / barrel. It seems safe to proclaim that European production is in terminal decline.

Middle Eastern production has been undulating but still shows a gradual increase. The dip in 2006 that bottomed out in 2007 coincides with the increasing global price of crude oil and appears to have been caused by them being unable to increase production. The dip that bottomed out in 2009 was an intentional reduction by OPEC in response to demand reduction caused by the global financial crisis of 2008. The downturn in 2012 is mostly explained by sanctions against Iran and reductions in Saudi Arabia. It is not clear whether Saudi Arabia has intentionally reduced production or whether they have been unable to maintain production at 10 Mb/d. EIA data show them at 9.2 Mb/d in December 2012. Because they have oil fired electric generations that they ramp up in the summer to power their air conditioners and refrigerators, we will see what happens this summer. They are promising Manifa will produce 500 kb/d up from nothing by the end of this year and reports are that they are frantically drilling. They have announced large scale solar projects which might reduce their domestic demand freeing crude oil for export. As Matt Simmons said, "When Saudi Arabia peaks, so does the world." Has Saudi Arabia's manhood turned limp, or do they have a few more good years? Stay tuned.

North American production has sharply risen over the last 4 years with production from Canadian tar sands and American tight oil overwhelming the declines from America's Prudhoe Bay and Mexico's supergiant Cantarell field, at one time the second largest oil field on Earth.

EIA Africa Crude Oil & Lease Condensate Production January 2000 to December 2012
EIA Africa Crude Oil & Lease Condensate Production January 2000 to December 2012

EIA Central & South America Crude Oil & Lease Condensate Production January 2000 to December 2012
EIA Central & South America Crude Oil & Lease Condensate Production January 2000 to December 2012

EIA Eurasia Crude Oil & Lease Condensate Production January 2000 to December 2012
EIA Eurasia Crude Oil & Lease Condensate Production January 2000 to December 2012

EIA Europe Crude Oil & Lease Condensate Production January 2000 to December 2012
EIA Europe Crude Oil & Lease Condensate Production January 2000 to December 2012

EIA Middle East Crude Oil & Lease Condensate Production January 2000 to December 2012
EIA Middle East Crude Oil & Lease Condensate Production January 2000 to December 2012

EIA North America Crude Oil & Lease Condensate Production January 2000 to December 2012
EIA North America Crude Oil & Lease Condensate Production January 2000 to December 2012

EIA World Crude Oil & Lease Condensate Production January 2000 to December 2012
EIA World Crude Oil & Lease Condensate Production January 2000 to December 2012

The world peak production remains in April 2012 at 76.02757 Mb/d with its value revised upward by 58.566 kb/d from November.

EIA Revisions Between Data Released in November 2012 and December 2012
2000-01 to 2006-12 0 no change
2007 all increases ranging from 55.31 kb/d to 60 kb/d
2008 +70 all months increase by 70 kb/d
2009 +80 all months increase by 80 kb/d
2010 +70 all months increase by 70 kb/d
2011 all months increase ranging from 44.64 kb/d to 92.87 kb/d
2012-01 +62.81
2012-02 +67.03
2012-03 +99.61
2012-04 +58.57
2012-05 +61.55
2012-06 +59.83
2012-07 +93.58
2012-08 +79.32
2012-09 +25.97
2012-10 +98.48
2012-11 +165.64

I was looking at the chart on the top of Stuart Staniford's post here: http://earlywarn.blogspot.com/2013/04/monthly-oil-supply-update.html

Where he says: "The big picture is that the bumpy plateau slopes upward in both sets of data (ie anyone claiming peak monthly oil production was in 2005 or 2008 is not paying attention to the data)."

Well...I see something strange here - there's not a steady slope in the plateau but a sudden break that occurs somewhere mid-2010 to mid 2011. Until then there is a solid plateau, and after that there is a sudden disconnect leading to a new plateau but shifted upward 2 mb/d.

Could that be entirely shale-mania driven?

Excellent graphs! They really show what's happening with global oil production.

Could that be entirely shale-mania driven?

Could be.

All Data is KB?D EIA last data point December 2012, JODI last data point February 2013.
EIA World Less USA photo EIAWorld-USA_zpsbff95e40.jpg

JODI World Less USA photo JODIWorld-USA_zpsdc5e2834.jpg

Ron P.

The dip during 2011 was caused by the Libyan revolution which reduced their crude oil production to zero. Because U.S. tight oil rocketed upward beginning in January 2011, it did not cause the increase from 2009 to 2011 January in world production. Without the sanctions on Iran, world production could be about 700 kb/d higher (76.7 Mb/d) currently which might have lowered the price of oil enough to kill the tight oil boom in the U.S. Since Obama does not seem intent on invading Iran, maybe the sanctions were really about manipulating the price of crude oil.

On my graph of World production the rolling annual average curve in 2008 is slightly higher than the one in 2005 showing a slight upward slope that accelerated in 2010.

Hmm - there might actually be three trends here. If you draw a line from mid 2005 to mid 2009 (ignoring the spike in 2008) you have a very definite trend easing downward...then from the mid 2009 point to the beginning of 2012 (ignoring the drop in 2011) we find another...now from 2012 on...? WAG - based on the look of that recurve at the end I would expect without anything amazingly new to see somewhere between flat and downward at the '05 to '09 pace for a while.

2005-2009: Down
2009-2012: Up
2012+: Flat to down?

According to your North America C+C graph from 2009 to now it's gone from 10.5 to over 12.5 mb/d...which accounts for that 2 mb/d plateau shift. A large portion of that gain could be condensate.

The 2005 to 2007 period seems particularly telling to me - it's a period of solid production decline against the backdrop of rising price. In 2008 some of the lagging projects probably came online and everyone decided to push as hard as possible to exploit $140/bbl, then economic collapse...that 2009 was on the same trend line as '05-'07 may or may not be coincidence, then the shale plays step in to muddy things up for a few years - a nice pump-fake to lull everyone into a false sense of security.

The price response could be the burst that creates the peak.

The undulations in world production from 2005 through 2010 are correlated with Saudi Arabia's production. If the decline rate of their old oil wells is 700 kb/d/year and they get Manifa's production up to 500 kb/d, then their production will not decrease much by the end of this year. Provided demand does not decrease or geopolitics do not affect things, I suspect world production will increase to a new high this year.

Maybe the reversal of the Seaway pipeline has something to do with the increase in North American production over the last year. It allows oil producers to get more oil to market. An article in Reuters dated May 19, 2012, when the pipeline opened states:

A new pump station is under construction at the Cushing end to allow flows to reach 400,000 bpd in early 2013. Ultimately, Enbridge and Enterprise plan to more than double the line's capacity to 850,000 bpd.

800,000 b/d plus the anticipated capacity of the Keystone XL pipeline might be an indicator of the increase in North American production over the next several years.

CNN reporting a Waco, Texas fertilizer plant explodes; widespread damage. No story yet, but if it was natural gas -> ammonium nitrate it could be something like the Texas City explosion in 1947. Triage center set up at local football stadium.

edit: Stories coming in -




Major explosion being reported at West, Texas fertilizer plant (near Waco). I posted links but the comment is on hold. Anhydrous Ammonia/natural gas = widespread damage to surrounding area.

Boston, California, Texas. It is enough to make me nervous.

Yeah, the situation looks awful. :-(

Youtube video of explosion:

Ironically on the same date as the Texas city fertilizer port disaster in 1947.


‘Like a nuclear bomb’: Deadly fertilizer plant blast devastates Texas town

(CNN) — The full extent of the devastation will have to wait until the light of day Thursday. But residents of the small Texas town of West already know what to expect.

“There are a lot of people that got hurt,” West Mayor Tommy Muska forewarned Wednesday night. “There are a lot of people that will not be here tomorrow.”

A massive explosion at a fertilizer plant on the edge of the town killed at least two people, wounded more than 150, leveled dozens of homes and prompted authorities to evacuate half their community of 2,800.

“It was a like a nuclear bomb went off,” Muska said. “Big old mushroom cloud.”

I drive the section of I-35 that goes by this little town all the time, fertilizer plant was on the other side of town so not that visible from the highway. Looking at it from google earth they are going to have to be very careful going into the facility. There are probably several dozen of the little anhydrous tanks that the farmers pick up drive to thier farms with and attach to the fertilizer system on thier tractors. Each of these tanks is a little smaller than a normal home propane tank and can hold ~1000 gallons each. If shrapnel from the explosion punctured just a few of these you have a fairly toxic short term mess right at the facility. Kind of scary to look at the ariel photos, there was a school and maybe park, the playgorunds were literally right across the railroad tracks from the plant, seems like on a good normal day thats a bad place for a playground.

I'm reminded of the Buncefield explosion, seems to be of comparable size. (2.4 versus 2.1 on the
richter scale).


This being a small, crowded island, we could only manage to keep the site 800 metres from residential properties, and the explosion happened with very little warning, resulting in 2 people being seriously hurt. The massive release of aviation fuel ? was entirely contained on site by earth ramps although there was minor blast damage up to 5 miles away.

We were fortunate in the timing, 6 am on a Sunday, but to build houses, an old peoples' home and a school 100 M from an uncontained fertilizer factory on that scale would result in prosecution for manslaughter here.

In a minor defense of the plant from the look of things it was once about a mile away from the town surrounded on all sides by the farms it supports, and to the North and East it is still a vast area of farm land. The town looks like it grew into the plant, the area back in maybe the 50's should never have been zoned residential.

Given that there was a fire at the site before hand this looks like another spectacular example of a Boiling Liquid Expanding Vapor Explosion or BLEVE.

Search Google Videos or YouTube for many other examples.

According to the Dallas Morning News story, there was a fire, the fire was fought with water, the ammonium nitrate became wet, and the ammonium nitrate exploded.

NH4NO3 -> N2O + 2 H2O

Major Errors Undermine Key Argument For Austerity Frequently Cited By Media

A wide swath of media figures have cited economists Carmen Reinhart and Kenneth Rogoff's January 2010 finding that a country's economic growth becomes impaired when its debt level exceeds 90 percent of gross domestic product. But the Reinhart-Rogoff paper is premised on an Excel error, revealed when other researchers reviewed the data underlying the commonly-cited debt-to-GDP threshold claim.

Austerity proponents, such as House Budget Chairman Paul Ryan (R-WI), frequently claim that a debt-to-GDP ratio of 90 percent signals economic doom, using Reinhart and Rogoff's work as leverage for imposing sharp cuts that economists agree would do serious harm to economic growth. Media coverage of budget and economic policy throughout the past three years has also repeated that claim, often without a direct connection to the Reinhart-Rogoff work from which the notion derives.

But that work, arguably the lynchpin of the case for imposing austerity in order to deliver economic growth, is crippled by basic errors, as the Roosevelt Institute's Mike Konczal explains:

A major economic research paper has errors and uses selective data. How can that be ? /sarc

From the beginning there have been complaints that Reinhart and Rogoff weren't releasing the data for their results (e.g. Dean Baker). I knew of several people trying to replicate the results who were bumping into walls left and right - it couldn't be done.

In a new paper, "Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff," Thomas Herndon, Michael Ash, and Robert Pollin of the University of Massachusetts, Amherst successfully replicate the results. After trying to replicate the Reinhart-Rogoff results and failing, they reached out to Reinhart and Rogoff and they were willing to share their data spreadhseet. This allowed Herndon et al. to see how how Reinhart and Rogoff's data was constructed.

They find that three main issues stand out. First, Reinhart and Rogoff selectively exclude years of high debt and average growth. Second, they use a debatable method to weight the countries. Third, there also appears to be a coding error that excludes high-debt and average-growth countries. All three bias in favor of their result, and without them you don't get their controversial result. [...]

So what do Herndon-Ash-Pollin conclude? They find "the average real GDP growth rate for countries carrying a public debt-to-GDP ratio of over 90 percent is actually 2.2 percent, not -0.1 percent as [Reinhart-Rogoff claim]." Going further into the data, they are unable to find a breakpoint where growth falls quickly and significantly.

Time for an economist joke.

The absolute best part is that they're from Harvard.

To be honest, I would not be even a little bit surprised if they put the error in on purpose. These people live and work at the highest temple of the establishment and their work reflects their wish to please and validate that establishment.

"Time for an economist joke."

That would be redundant.


smartass mode on/


smartass mode off/

initially derived from a 1994 article in The Wharton Journal:

Q: How many economists does it take to change a light bulb?

A1: None. The darkness will cause the light bulb to change by itself.

A2: None. If it really needed changing, market forces would have caused it to happen.

A3: None. If the government would just leave it alone, it would screw itself in.

A4: None. There is no need to change the light bulb. All the conditions for illumination are in place.

A5: None. Because, look! It’s getting brighter! It’s definitely getting brighter!!!

A6: None. They’re all waiting for the unseen hand of the market to correct the lighting disequilibrium.

A7: Don't bother. Thanks to solar energy there's only electricity when the sun is shining.

A8: Don't bother. We need the electricity to recharge our Teslas.

High noon in Germany (12 o'clock data from agora-energiewende):

wind power 16.9 GW
PV 19.2 GW
hydro 2.4 GW
biomass 3.8 GW

conventional 33.9 GW

sum 76.2 GW, of which are 42.3 GW renewables.

German demand ~68 GW
export ~ 8 GW

Until now no complaints due to net instabilities.

Yeh, Germany.

CNBC: "Unbelievable, what a climb that has been" (Carl Quintanilla regarding natgas prices)

Looks like we have already busted through the $4.25 "Price ceiling"  (as predicted by a natgas trader on CNBC a couple of weeks ago).

In round numbers, we have shown about an 800 BCF decline in natgas storage, year over year, with basically flat (to perhaps recently declining) dry natgas production.  

If we show a year over year decline in production, or arguably even if we continue to show flat production, it seems to me we are going to have to see a pretty substantial increase in price in order to avoid running short of storage next winter.

Unbelievable? Have they looked at the rig counts? People abandoned natural gas because they were losing their shirts. Of course the price was going to eventually go higher eventually.

As Art Berman has discussed for some time, once we see a material decline in US natgas production, the interesting question is whether we will be able to bring US natgas production back to prior levels, i.e., about 2.0 TCF per month, given that the we almost certainly finished 2012 with the highest overall decline rates in US history, and the overall decline rate from existing wells in 2012 had to be much higher than at the start of the shale gas boom.

A CNBC interview from 3/28/13, with a trader--who had apparently been drinking the "100 Year Gas Supply" Kool Aid--and who a year ago apparently predicted $1 natgas (per MMBTU). Said analyst three weeks ago predicted that the price ceiling would be $4.25.


The low price portion of the cycle lasted 4.5 years instead of the more traditional 1.5 years.

Extrapolating current trends in energy consumption and demographics shifts, I've got a new post: (It's the Energy!) Why Successful Cities Will Be Largely Car-free by the End of 2015.


(This is part one of a two-part series. Part two should be out soon.) It turns out US per capita total energy consumption has been dropping substantially the last few years, as has US per capita oil btu consumption. Other trends, too--falling EROEIs, rising oil consumption in oil-exporting countries, fewer vehicles/person, Millennials (who prefer phones and computers to cars) gaining demographic prominence. Charts and graphs!

Impresssive bit of work and I wish this would be posted here. I hope that trend continues. In any event, I hope many who read here to your blog and post their critique of your projections.

Cambridge is one of the most successful (small) cities in the UK. It also has the highest percentage of regular cyclists (43% of residents) in the UK. It's streets are still choked with oil burning traffic.

Still, its a start (or, more accurately, a living fossil from an earlier epoc).

Silicon Carbide Ready to Run the Rails

On the Ginza Line, one of the cars was equipped with a pair of SiC inverters housed in one compact unit roughly 40 percent smaller and lighter than the silicon-based system it replaced. Each inverter controlled two 135-kilowatt induction motors; two other cars retained their old silicon inverter systems.

“Between the end of July and August 17 last year, we recorded a 38.6 percent energy savings compared to a conventional system,” says Hirotoshi Shiratori, head of Mitsubishi’s transport systems engineering section. “This included the increased regenerated power from a new regenerative braking system that is also part of the installation.” In this case, kinetic energy created when the brakes are applied is converted into AC and fed back into the rail system. “Compared to 22.7 percent regenerated power of a conventional system, the SiC system returns 51 percent,” Shiratori explains. After a year of testing, Mitsubishi is now ready to commercialize the technology and has received 14 orders for systems from domestic customers and 113 orders from overseas.

The company is also preparing a train energy-management system that will store regenerated energy in an onboard battery unit on the railcar. Takashi Kimura, senior manager of Mitsubishi’s transport systems division, explains that this setup will operate when other trains on the line are not available to take advantage of the regenerated energy. “In such cases, the regenerated energy can be used by the car itself,” he says.


Sea Lion Stranding's Climb, Scientists Stumped

Since the beginning of the year, 1,293 sea lions have washed ashore from San Diego County to Santa Barbara County. That's more than five times higher than the region's historical average of 236, averaged from the same period of time (January through April) from 2008 to 2012.

"The prevailing onshore winds did not blow as strongly as they usually do and it resulted in a lack of upwelling, which created a foraging difficulty for California sea lions," Wilkin explained.

More strange weather anomalies.

More strange weather anomalies ...

Tornado Drill Postponed Due To Possible Tornadoes

... The April 18, 2013 tornado drill for Wisconsin will be postponed to Friday, April 19, 2013, because severe storms are possible on Thursday, April 18th over the southeast third of Wisconsin. Severe weather is defined as tornadoes, damaging thunderstorm wind gusts of 58 mph or more, or large hail 1 inch in diameter or larger.

Re: Sea Lions - Wonder if the dolphin mega-pod sightings off San Diego back in February are related?


San Diego tourists treated to dolphin ‘superpod’ sighting

Footage taken from the deck of the ship shows thousands of dolphins elegantly leaping above the waves. KFMB San Diego
reports the superpod was estimated to be around seven miles wide and five miles long. Experts believe there were thousands
of the marine mammals swimming and soaring together.

I googled the dolphin superpod, because I had not heard about it before and pasted it in above. Fascinating, I didn’t know a pod of dolphins could be that big, but also fascinating because dolphins are probably smarter than seals, and therefore capable of out-competing them for available food sources. If this is what happened, then it’s interesting from the standpoint of how different is this from humans out-competing other species for food sources due to higher intelligence, resulting in higher populations.

Despite Superbug Crisis, Progress in Antibiotic Development 'Alarmingly Elusive'

Despite the desperate need for new antibiotics to combat increasingly deadly resistant bacteria, the U.S. Food and Drug Administration (FDA) has approved only one new systemic antibiotic since the Infectious Diseases Society of America (IDSA) launched its 10 x '20 Initiative in 2010—and that drug was approved two and a half years ago.

In a new report, published online today in Clinical Infectious Diseases, IDSA identified only seven new drugs in development for the treatment of infections caused by multidrug-resistant gram-negative bacilli (GNB) bacteria. GNB, which include the "nightmare bacteria" to which the Centers for Disease Control and Prevention (CDC) alerted the public in its March 2013 Vital Signs report, represent the most pressing medical need. Importantly, there is no guarantee that any of the drugs currently in development to treat GNB will make it across the finish line to FDA approval and none of them will work against the most resistant bugs we're worried about today.

"We're losing ground because we are not developing new drugs in pace with superbugs' ability to develop resistance to them. We're on the precipice of returning to the dark days before antibiotics enabled safer surgery, chemotherapy and the care of premature infants. We're all at risk," ...

Ironically, at this urgent time of greatest need, the number of pharmaceutical companies investing in antibiotic R&D has plummeted. Pharmaceutical companies typically put R&D resources into the development of chronic disease drugs – including those to treat high cholesterol, diabetes, and cancer – which provide significant financial rewards, partly because they are intended to be taken for long periods of time. Antibiotics, which are intended to be taken for short courses, just can't compete. The results are playing out in real time, with the smaller pharmaceutical company Polymedix – which has one of the seven drugs in development noted in the 10 x '20 paper – filing for bankruptcy protection in early April 2013.

3 New Planets Could Host Life

In the midst of chaos here on Earth, scientists are finding hope for life on other planets.

Kepler-62f is thought to be 40% larger than Earth and could be rocky, he said. It goes around its star once every 267.3 days (Earth days, that is).

Kepler-62e appears to be 60% larger than our planet and a little closer to its host star; this one could be a "water world" of mostly deep oceans, he said. It circles its star in 122.4 days.

"With all of these discoveries we're finding, Earth is looking less and less like a special place and more like there's Earth-like things everywhere,"

also http://phys.org/news/2013-04-astrophysicists-five-planet-earth-like-exop...

and http://kepler.nasa.gov/

New Coating Could Enable Major Boost in Solar-Cell Efficiency

Throughout decades of research on solar cells, one formula has been considered an absolute limit to the efficiency of such devices in converting sunlight into electricity: Called the Shockley-Queisser efficiency limit, it posits that the ultimate conversion efficiency can never exceed 34 percent for a single optimized semiconductor junction.

Now, researchers at MIT have shown that there is a way to blow past that limit ...

While today's commercial solar panels typically have an efficiency of at most 25 percent, a silicon solar cell harnessing singlet fission should make it feasible to achieve efficiency of more than 30 percent, Baldo says—a huge leap in a field typically marked by slow, incremental progress.

There seems to be something wrong with the above post. Something about blowing past the limit.

The limit was/is enforced bacause you only get 1 electron per photon. The way to beat it is to get 2 electrons from the more energetic (bluer) photons. That is what they claim to do. Then teh formula from which the limit was derived is modified, and that new formula allows a higher limit.

Now I have a bit of a problem with the happy-happy spin -probably done by not very scientific PR types. They've only demonstrated it with low efficiency organic solar cells, not by adding it onto an already decent silicon cell. So a lot of work remains between this research and something that can be used to tweak PV manufacturing lines into getting a big efficiency boost.

The limit was/is enforced bacause you only get 1 electron per photon. The way to beat it is to get 2 electrons from the more energetic (bluer) photons. That is what they claim to do. Then teh formula from which the limit was derived is modified, and that new formula allows a higher limit.

Now I have a bit of a problem with the happy-happy spin -probably done by not very scientific PR types. They've only demonstrated it with low efficiency organic solar cells, not by adding it onto an already decent silicon cell. So a lot of work remains between this research and something that can be used to tweak PV manufacturing lines into getting a big efficiency boost.

The Fertilizer Plant Explosion

There are a number of posts above this about the "fertilizer" plant blowing up. I'd remind people that an ammonia plant it more of a chemical plant than anything else.

But, what I want to say is how many of you have actually experienced a plant disaster? I have.

It was a number of years ago, my facility (a pilot plant) was in Hawthorne, NJ. I was in a meeting with my boss in Dover, DE. About noon, my boss' secretary came in to say that my facility had blown up and that there were many hurt or killed. (Let me throw in at this point that it turned out not to be my fault.)

It is a three hour drive from Dover to Hawthorne. The disaster was on all the east coast stations from Philly to NYC. I kept telling my boss that we weren't doing anything that would result in a plant explosion as we drove to Hawthorne. However, as we finally came close to the plant I could see a plume of smoke similar to the one in TX. It was real!

Do any of you have any idea what it is like to think that an error of commission or omission on your part resulted in people's death and the total destruction of a multi-million dollar production facility because you somehow screwed up? The smoke plume said I did.

However, it turned out that there was a dust explosion in the production facility and my building was simply burned down. 15 were killed and a number were injured. But...I didn't know for several hours. It changed my life. I don't know how to explain it but it led me to eventually leave the chemical industry.

One thing I remember a few days after the explosion (the production facility was still smoking/burning): We were rigging chemical reactors from my facility to ship them to Dover. I was on the roof playing with a cutting torch cutting piping (you do what you have to do). There was a cadaver dog sniffing just beyond the remaining walls of my building. At that time they only had part of a skull and a rib cage for two missing people. I kept praying that it wasn't within my view because I frankly don't know how I could deal with anything more at that point.

Finally, what really pissed my off was that the corporate PR people tried to shine the explosion on. I won't go into it but they were POS just to make a buck.

I am sure that there are people at the fertilizer plant who are going through exactly what I did. It is totally overwhelming.


A sad fact about that plant explosion:

A look at the satellite image above shows the folly of putting “free enterprise” ahead of sensible zoning laws. At almost 20 miles north of Waco, Texas, one thing that is in abundance in the region is open space (I’ve driven past this spot several times in the last two or three years–it’s desolate), and yet this fertilizer plant is immediately adjacent to a large apartment building (see the photo at the top of this article for how that building fared in the explosion) and very close to a middle school. There is no reason at all for any other building to be within two or three miles of a facility that produces material that is so explosive.


That large apartment building? Actually, a senior citizen complex. And it got really destroyed. :-(

On that topic, especially since i still work in the chemical industry, the report on the Chevron fire is out.


It's a big PDF, the link is on the right under Featured Reports. The main point is Major Management Failure. They knew the pipe was thinning 10 years ago, but did they do anything? Of course not. If they didn't want to spend the money on a better alloy, they could have simply replaced the pipe. It was just 8" schedule 40 carbon steel. The piece that failed was over 30 years old, it's not like they didn't get their money out of it. (And they did have a valid reason to not use stainless steel. Other suitable alloys are available.)

There are also some interesting points about the PHA process (Process Hazard Analysis) that you won't understand unless you were part of one.

When questioned about my heavy expenditure on safety equipment and training compared to my predecessor, I simply said that I did not wish to find myself explaining to a widow why her husband was poorly equipped or trained, especially when we're a successful and capable company. I think it actually is a selling point with customers when my guys have recent safety certs, all relevant training, personalized gear, and some-would-say-optional safety equipment. Some companies require all this before you go on site, but MANY cut corners all the time.

And yet still when I hear about compressor stations burning down or pipelines exploding, I catch myself thinking "I really hope our equipment didn't cause that!"

Relentless And Disruptive Innovation Will Shortly Affect US Electric Utilities

The report notes that the industry would benefit from “proactive assessment and planning to address disruptive challenges” and highlights some interesting statistics that reflect the dynamic of disruption. Among them:

1) PV panels have fallen in price from $3.80 per watt to .86 per watt in just four years, from 2008 to mid-2012.

2) PV solar is now grid-competitive in 16% of the US retail market (higher on-peak time-of-use rates reinforce that dynamic).

A many years back, I installed my own PV solar system. The local utility wanted to have a "solar parade" day where they wanted people that installed solar systems to have an open house to show others. I signed up . . . and then I went overboard. I created my own packs with short paper summary of my system and a CD with full building department approved plans for my system, a list of all the equipment installed, a full description of how other people could do the same. The system was about $5.50/watt (self installed).

The same system would cost less than $2/watt today.

It is the install costs that is the big problem now. The DoE needs to do something to create a simplified national code to reduce install costs.


For me, when I go exercising walking in my neighborhood, I like trying to spot how many houses have PV.

I know of five so far, and I live in an urban suburb 11 miles away from downtown Los Angeles : )

So I see PV slowly and stealthily growing in my area.