The problem with wind energy is that it drives prices down! From Bloomberg news:

After years of getting government incentives to install windmills, operators in Europe may have become their own worst enemy, reducing the total price paid for electricity in Germany, Europe’s biggest power market, by as much as 5 billion euros some years, according to a study this week by Poeyry, a Helsinki-based industry consultant.

Jerome a Paris has an excellent discussion of the article over at The Oil Drum. He also links from there to an excellent (and entirely wonky) discussion of the proper pricing of wind power. It is a great article – one key takeaway is that wind power actually brings electricity prices down! Understanding that assertion requires a discussion of marginal costs, initial investments, demand curves, spot pricing, intermittency, externalities, and Spitzenlast (see above), but it’s totally worth it.

Another key point is that “market” pricing actually tilts the playing field toward fuel-based generation of electricity, because of its lower capital and debt-servicing requirements:

selecting market mechanisms to set electricity prices (rather than regulating them) is, again, not technology neutral: here as well, deregulated markets are structurally more favorable to fossil fuel-based generation sources than publicly regulated price environments.

So while I definitely wanted to highlight the issues around wind power (and point you to some excellent, informed commentary), I mostly just wanted an excuse to show that graph! SPITZENLAST!

Today, I noticed an ad for California Prop 16, with the catchline “Preserve Your Right To Vote.” Thinking that this sounded like a lot of spin, I decided to look it up.

According to Ballotpedia, this is basically an initiative funded by PG&E to make it more difficult for municipalities to start their own utilities.  It would amend the California state constitution to require that any Community Choice Aggregator be approved by a 2/3 vote.

Now, I already thought that California’s system for amending the constitution by a simple majority is ridiculous, but this really takes the cake.  (Perhaps even the lemon olive oil cake.  See below.)

Let me get this straight — you’re using a simple 50% vote to require that, in the future, individual communities need a 2/3 majority to do something?  That seems really backward.

But what really gets me is that PG&E, a monopoly public utility, is planning on spending $25-35 million dollars to singlehandedly fund the campaign for this initiative — that’s money that we’re paying them!

According to Andrew Clark in the Guardian,

The rump of the bankrupt bank Lehman Brothers is sitting on a stockpile of 450,000 lb of uranium “yellowcake” which could be used to power a nuclear reactor or, theoretically, to make a bomb.

Those are some seriously toxic assets!

Remember when yellowcake was such a big deal that the U.S. government used it as justification to invade and destroy Iraq? Here are those famous sixteen words again, in case you’ve forgotten Bush’s fabulous 2003 State of the Union speech:

The British government has learned that Saddam Hussein recently sought significant quantities of uranium from Africa.

So, maybe the U.S. will be invading Lehman Brothers next…?

Dec. 2, 1942:  The first man-made controlled nuclear reaction takes place, underneath the grandstand of the University of Chicago’s football grandstand.

Dec. 2, 1957:  The first commercial nuclear power plant goes online, in Shippingport, PA.

Wired has an article, here:  http://www.wired.com/science/discoveries/news/2008/12/dayintech_1202

One interesting piece of historical nomenclature is that, at the Chicago experiment, there was a staffer prepared to cut a rope with an axe, to drop graphite rods into the reactor and stop the reaction.  This acronym, SCRAM, for Safety Control Rod Ax-Man, is still used for the emergency shutdown systems in modern reactors.

IRAQ WAR ENDS and other great headlines in today’s (fake) New York Times (courtesy of The Yes Men).

Seriously. We’ve been hearing for years that Americans need to curb their excessive consumption habits. We’ve been told that we drive too many cars, we use too much electricity, we throw away too much plastic, we import too much oil, and on and on and on.

Suddenly, we’re using less oil; we’re driving fewer miles; we’re buying fewer cars; we’re buying fewer goods; and we’re using less electricity. But this is all being reported as “bad” news!

We obviously are in desperate need of new ways to measure economic and social well-being. It shouldn’t be a headline crisis when U.S. auto sales drop 50%, it should be a sign of much-needed progress!

Spending and growth are not the measures of a healthy and satisfying life. I’ve been thinking about this stuff a lot since I read Bill McKibben’s Deep Economy. I’ll do a “dogeared” post on it soon…

“[Oil company] reports record profits…”

That headline ran today. It also ran in July, 2008. According to my search of the New York Times archives (oil AND record AND (profit OR profits)), it also ran in April, 2008. It also ran in February, 2008. It also ran in February, 2007. It also ran in July, 2006. It also ran in January, 2006. It also ran in October, 2005. It also ran in August, 2005. It also ran in February, 2005. It also ran in August, 2004. It also ran in July, 2004. It also ran in October, 2000. It also ran in July, 2000. It also ran in May, 1997. It also ran in January, 1997. It also ran in January, 1990. It also ran in October, 1988.

It’s funny. I guess if you control the supply of something vital to every sector of the economy, and there’s no limit on your pricing power (other than “the market”), then you can pretty much guarantee you’ll earn a shitload of money.

Here’s the relevant graf from 11 years ago:

Exxon, the largest oil company in the United States, said its profit jumped nearly 49 percent to a record $2.49 billion, or $2 a share, in the fourth quarter, compared with a profit of $1.68 billion, or $1.35 a share, in the similar quarter of 1995. Revenue climbed to $37.62 billion from $31.50 billion.

And here’s the word today:

Exxon Mobil Corp.’s third-quarter net income rose 58% to a new record of nearly $15 billion… Exxon Mobil said it earned $14.83 billion, or $2.86 a share, up from $9.41 billion, or $1.70 a share in the year-ago period.

Those are quarterly profits, not gross receipts. That’s a profit rate of almost $2,000 per second!

I also enjoyed finding this little nugget in an April 27, 1986 article in the New York Times:

President Reagan urged the repeal of the ”windfall profits” tax on domestic oil in an attempt to help out those companies hit by the price drop.

That tax was repealed on August 23, 1988, and has not been reinstated – although oil prices, which were around $38/barrel in 1980 and had fallen below $20/barrel in 1988, peaked above $140/barrel this summer.

I want to live in a dome house! I think…

From the pretty darn cool green-blog Inhabitat.

Food writer Michael Pollan has a terrific article in last week’s New York Times Magazine, where he outlines the food-related policy challenges facing the incoming U.S. president. In his opening, he notes a startling fact about the energy consumed in the industrial agriculture process:

chemical fertilizers (made from natural gas), pesticides (made from petroleum), farm machinery, modern food processing and packaging and transportation have together transformed a system that in 1940 produced 2.3 calories of food energy for every calorie of fossil-fuel energy it used into one that now takes 10 calories of fossil-fuel energy to produce a single calorie of modern supermarket food. Put another way, when we eat from the industrial-food system, we are eating oil and spewing greenhouse gases. This state of affairs appears all the more absurd when you recall that every calorie we eat is ultimately the product of photosynthesis — a process based on making food energy from sunshine. There is hope and possibility in that simple fact.

I think his point would be clearer if he kept his numbers in the same order, though, like this: in 1940, the system produced 2.3 calories of food energy for every calorie of fossil-fuel energy used; today, it produces 0.1 calorie of supermarket food energy for every calorie of fossil-fuel energy used.

The New York Times, June 19, 2008:

Four Western oil companies are in the final stages of negotiations this month on contracts that will return them to Iraq, 36 years after losing their oil concession to nationalization as Saddam Hussein rose to power.

Exxon Mobil, Shell, Total and BP — the original partners in the Iraq Petroleum Company — along with Chevron and a number of smaller oil companies, are in talks with Iraq’s Oil Ministry for no-bid contracts to service Iraq’s largest fields.

The New York Times, June 30, 2008:

A group of American advisers led by a small State Department team played an integral part in drawing up contracts between the Iraqi government and five major Western oil companies to develop some of the largest fields in Iraq, American officials say.

The disclosure, coming on the eve of the contracts’ announcement, is the first confirmation of direct involvement by the Bush administration in deals to open Iraq’s oil to commercial development and is likely to stoke criticism…

At a time of spiraling oil prices, the no-bid contracts, in a country with some of the world’s largest untapped fields and potential for vast profits, are a rare prize to the industry…

A potential area of criticism, however, is that only Western companies got the bigger oil contracts. In particular, Russian companies that have experience in Iraq and had sought development contracts are still waiting.

British Prime Minister Tony Blair, February 6, 2003:

No, let me just deal with the oil thing because this is one of the… we may be right or we may be wrong, I mean people have their different views about why we’re doing this thing.

But the oil conspiracy theory is honestly one of the most absurd when you analyse it.

The fact is that, if the oil that Iraq has were our concern I mean we could probably cut a deal with Saddam tomorrow in relation to the oil.

It’s not the oil that is the issue, it is the weapons.