So I don't see how this particular kind of subsidy will change much if right now, cities would truly choose gas and wind. You can't have only nuclear and wind -because nuclear produces pretty much the same all the time, and you can't have all consumption peaks on windy days. It seems that the carbon pricing (which I would welcome) would just mean that you would only use your gas as a complement to your fleet of wind and nuclear turbines, rather than as a complement to your fleet of wind turbines. But the quantity of wind power should remain the same. Am I missing something? "Few can believe that suffering, especially by others, is in vain. - Galbraith"
The baseload/intermittency issues are skipped over in that short article. In the long run, we're all dead. John Maynard Keynes
Now when demand is that damned inelastic, you can tax it to the moon, and still not cause consumption to drop. Which of course means that it's an excellent revenue source for the government.
When the government finally realized this about cigarettes, state governments started to ramp up taxes on them to create a new revenue source.
This is important to remember in US energy debates. And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg
If you gasoline consumption indeed doesn't drop, cet. par. you still end up with less money to spend. Should we expect a backlash from other actors of the car industry if taxes were to be raised? The other thing may be that cars allows for the creation of a constituency.. and so any attempt at raising gas taxes may allow you to be undercut electorally. Rien n'est gratuit en ce bas monde. Tout s'expie, le bien comme le mal, se paie tot ou tard. Le bien c'est beaucoup plus cher, forcement. Celine
Smokers are a minority in American society, and political cost of sticking it to them on taxes is fairly low. The thing about people who complain about taxes is that they are most often the least engaged in politics, and the least likely to vote. And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg
I think that the degree to which energy demand in the US is inelastic, specifically with reference to home electric and gasoline for transportation has just begun to dawn on US policymakers.
Well at some point it's going to have to become a lot more elastic Any idiot can face a crisis - it's day to day living that wears you out.
Of course, maybe standard economics is bunk because it supposes that consumers have a choice in the short term about how much they spend on gas. It's not like buying a new car, or moving to another house closer to work is something that can be done overnight. These sorts of repsonses to the market occur only in the long term.
And the problem isn't just one of creating demand, it's one of supply. It's much more difficult to purchase a fuel efficient car in the United States than in Europe. Now that's going to change as Detroit retools and the GM Volt plug in hybrid and other vehicles come out. But those cars aren't going to start coming off the factory line until 2009 or later.
Secondly, the patter of urban sprawl in America means that walking or taking the bus simply isn't a choice in most American cities. And in larger cities, older urban neighborhoods that are walkable often have little or nothing in the way of grocery stores and other basic commerical services. Tesco has announced that it's going to enter the US market, and try to establish itself in the small store urban market. However, the other big problem is that many of these urban neighborhoods are desprately poor and have horrendous crime rates.
Do you really think that families with small children are going to move to neighborhoods where there are open air crack markets and drive by shootings because the price of gasoline has gone up? Of course not, you'd have to be on crack to believe that.
But then orthodox economists seem to believe that this is the way that the world works. I'll let you draw your conclusions from that. And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg
Crack neighborhoods turn into regentrified neighborhoods when the value of the housing changes. This certainly doesn't happen overnight, but it can happen in, say, a couple of years.
In the 1970s there was a huge push for energy-efficient houses and cars, and if the adjusted price of energy goes up again, there will be another such push. The technology for off-grid or nearly off-grid housing is available and not tremendously expensive.
From a technical viewpoint, this is not an impossible problem to solve. From a political viewpoint, it probably is impossible, though.
you are the media you consume.
US utilities sceptical over nuclear plants "If you were a utility CEO and looked at your world today, you would just do gas and wind," Mr Immelt says. "You would say [they are] easier to site, digestible today [and] I don't have to bet my company on any of this stuff. You would never do nuclear. The economics are overwhelming." The US government has tried to win over nervous utilities by combining what were two separate licensing processes for building and operating nuclear plants. NRG Energy is seeking a single licence to build and operate, which may take four years. Under the old system, the process could take 11 years. It was possible for a power company to get a licence to build a plant but then fail to obtain approval to operate it, after pouring billions of dollars into construction. Many in the industry recall a $5.3bn New York plant that, once completed in 1984, could not overcome public resistance and be brought on stream.
"If you were a utility CEO and looked at your world today, you would just do gas and wind," Mr Immelt says. "You would say [they are] easier to site, digestible today [and] I don't have to bet my company on any of this stuff. You would never do nuclear. The economics are overwhelming."
The US government has tried to win over nervous utilities by combining what were two separate licensing processes for building and operating nuclear plants.
NRG Energy is seeking a single licence to build and operate, which may take four years. Under the old system, the process could take 11 years. It was possible for a power company to get a licence to build a plant but then fail to obtain approval to operate it, after pouring billions of dollars into construction. Many in the industry recall a $5.3bn New York plant that, once completed in 1984, could not overcome public resistance and be brought on stream.
A reactor is just a too big an investment for most companies in a deregulated market. Screw it up and the entire company might go down the drain. It's even worse as you don't have to screw it up for it too fail. Things far out of your control, like gas prices, might destroy your business.
The modularity of wind and gas (you can't build 200 MW of nuclear) is a great competitive edge as long as the State refuse to regulate the market. Even if nuclear might produce cheaper power than wind or gas on a per kWh basis.
With a carbon tax or cap, the nuclear investment becomes more profitable, making the higher risks more worthwhile. So would loan guarantees. But what's really needed is either a reregulated power market or loan guarantees, or preferably both. Peak oil is not an energy crisis. It is a liquid fuel crisis.
