- the financing cost would appear to be the least contentious. After all, a level playing field in that respect (via the interdiction of public guarantees for producers) should allow the best technologies to be chosen. In fact, that apparent policy neutrality is nothing but. The discount rate is actually the single most important determinant of which technology is competitive and which one is not. That comes form the fact that hydrocarbon-burning technologies tend to have much lower initial investment costs for a given production capacity, whereas renewable energies and nuclear, which have nil or low fuel costs, require much larger initial investment outlays. That means that, all other things being equal, a higher financing rate favors coal-fire and gas-fired plants, and a lower interest rate favors nuclear and wind. Choosing to finance the energy sector by the financial markets and not by States thus creates a structural bias towards coal-fired and gas-fired plants, as private sector investors need to pay higher interest rates than sovereign or sovereign-backed entities. To show how significant the interest rate is, here are some calculations made by the French Ministry of industry: http://www.eurotrib.com/files/3/060305_gen._centralis_e_impact_taux_escompte_DGEMP.jpg http://www.eurotrib.com/files/3/060305_co_tsoliens_selon_heures_et_tx_escompte_DGEMP.jpg Changing from a 5% rate (typically the rate at which governments or public bodies can use to borrow long term) to 8% (a more typical rate for the private sector) increases costs: for gas-fired plants by less than 5% for coal-fired plants by a bit more than 10% for nuclear plants by more than 30% for windpower by just under 20% Thus equal interest rates are not enough to compare competing power sources, the absolute level chosen matters as well. It is thus not neutral at all to promote, as current European policy does, private ownership of generation assets (and to more specifically forbid State support), as it will always skew investments towards gas-fired and coal-fired plants, unless you have specific regulations or subsidies that encourage investments in other sectors like renewables or nuclear.
That comes form the fact that hydrocarbon-burning technologies tend to have much lower initial investment costs for a given production capacity, whereas renewable energies and nuclear, which have nil or low fuel costs, require much larger initial investment outlays. That means that, all other things being equal, a higher financing rate favors coal-fire and gas-fired plants, and a lower interest rate favors nuclear and wind. Choosing to finance the energy sector by the financial markets and not by States thus creates a structural bias towards coal-fired and gas-fired plants, as private sector investors need to pay higher interest rates than sovereign or sovereign-backed entities.
To show how significant the interest rate is, here are some calculations made by the French Ministry of industry:
http://www.eurotrib.com/files/3/060305_gen._centralis_e_impact_taux_escompte_DGEMP.jpg http://www.eurotrib.com/files/3/060305_co_tsoliens_selon_heures_et_tx_escompte_DGEMP.jpg
Changing from a 5% rate (typically the rate at which governments or public bodies can use to borrow long term) to 8% (a more typical rate for the private sector) increases costs:
It is thus not neutral at all to promote, as current European policy does, private ownership of generation assets (and to more specifically forbid State support), as it will always skew investments towards gas-fired and coal-fired plants, unless you have specific regulations or subsidies that encourage investments in other sectors like renewables or nuclear.
Did it get lost in the way or did you take it out? Any chance to re-add it? In the long run, we're all dead. John Maynard Keynes
So, what was sent and in what form?
I have a couple of names of people we could send the final version to anyway. I'd be keen to send it again with that paragraph. See v5 linked above to see where it was positioned in the text. In the long run, we're all dead. John Maynard Keynes
(Here is Jerome's rough draft of the following bit:)
As I say below, there were inexplicable problems later between version 8, which included your language edits and mine, and version 11 where they had disappeared. We probably have to be careful to flag good versions and communicate in comments about what we are doing or have done.
The text above was sent as a PDF. I'll send the PDF out to the co-workers now. I'd have done so earlier but it took me an age to adapt the html (from writeboard) for Scoop.
I don't know what happened between your TXT.rtf file (sent by e-mail) and what you put up in writeboard, but there were differences. I asked you for confirmation that this (in writeboard) was your latest draft as compared with TXT.rtf. Perhaps you didn't see that comment, because you didn't reply. (See for this writeboard two, PW energygp2, document version 4, and my first comment on the thread).
Migeru pointed out that there was a back-reference to this explanation (above) while the explanation wasn't in the text, but you didn't react to that either. I could only assume you had cut this part. If you really wanted to put it in, then it's a pity, but I don't think anyone but you could have sorted this out.
I think we have to be very careful with drafts when working close on one another. There were problems later in the day, if you remember, where a version got crushed. Unfortunately, in this case, you didn't notice that part had gone. I don't recall having seen it (and it has links that go off the right margin, I think I'd have noticed).
My apologies, Jérôme. I'm really sorry it's missing.
Jérôme, do we take it you're not available to make this edit yourself?
We should just send an updated version - maybe that can be an opportunity to add signatories like we did in the earlier Open Letter - if you agree, would you make the request in the diary?
And I'm sorry I missed the absence of the paragraph yesterday evening. In the long run, we're all dead. John Maynard Keynes
Don't fret, in the context of this discussion you could take it as a joke... Those whom the Gods wish to destroy They first make mad. -- Euripides
I did one round of language editing. What's with the 'h1' and 'h2' text before the headlines? Those whom the Gods wish to destroy They first make mad. -- Euripides
There is in fact no trace of me moving them in the first place.
Are people abusing the "minor change: don't save a new version" feature? Those whom the Gods wish to destroy They first make mad. -- Euripides
I have now seen so many edits I don't know what they mean any more.
They seem better at the end of Section Two, leading on to the missing questions in the GP.
Should they be moved down there? (i.e. at the end, not the beginning, of the insertion?)
However, don't those two paragraphs make more sense at the end of the insertion rather than the beginning? Meaning, as a lead on to Section Three, the missing questions?
Do as you care to. In the long run, we're all dead. John Maynard Keynes
I'm beginning to wonder how we see what it is we see and then we don't...
I'm wondering whether people tick the "minor edit" box when they shouldn't, or what a genuine edit conflict looks like. Those whom the Gods wish to destroy They first make mad. -- Euripides
The question is, is it right to move them down?
But I am beginning to wonder about conflicts, since we have had several that are really inexplicable.
I certainly didn't delete this financial costs piece by Jérôme, for example. I would not delete a piece as substantial without referring to the author. And when you pointed out that it was missing, I would have remembered and said I took it out for one reason or another. I wonder if he and I were editing close in time to one another and one version scrambled the other.
And Jérôme didn't see the version that resulted from your copy-editing, then mine...
I expect the 2 tables can be reduced easily in a Word document, which is presumalby used to create the pdf? In the long run, we're all dead. John Maynard Keynes
