Windmill Jobs are Expensive

Tilting at Green Windmills
06/25/09 - Washington Post by George F. Will (via Cafe Hayek)

[edited] Gabriel Calzada is a professor of economics at Universidad Rey Juan Carlos, Spain. He has produced a report that is inconvenient for Obama's green agenda and for budget assumptions that are dependent upon it.

Spain is the leading country in aggressively supporting production of electricity from renewable sources. Calzada says Spain's huge spending on wind farms and other forms of alternative energy has indeed created jobs. But his report concludes that they are often temporary and have cost $752,000 to $800,000 each in subsidies, and $1.4 million each in the wind industry. Each such new job also destroys 2.2 other jobs in other industries because of the inefficient political allocation of capital.

European media regularly report "eco-corruption" leaving a "footprint of sleaze", such as gaming the subsidy systems and profiteering from land sales for wind farms. Calzada says the creation of jobs in alternative energy has subtracted about 110,000 jobs elsewhere in Spain's economy.

Robert Gibbs is the president's press secretary. It is weird that he dismisses this report as false witout reading it. He can't believe that some American importers are cashing in on the U.S. government's promotion of wind power, despite this being an economically unproductive project.

Calzada has come to conclusions that he, as a libertarian, finds ideologically congenial. And his study was supported by a like-minded U.S. think tank, The Institute for Energy Research, for which this columnist has given a paid speech. Many Spanish critics have impugned his patriotism because he faulted something in Spain which Obama has praised. But, they have not tried to refute the content of his report.

No Progress on Nuclear Energy

Nuclear Energy Update
06/20/09 - ChicagoBoyz by Carl from Chicago

[edited] Nuclear energy provides a significant portion of the world’s base load power capacity, along with coal power, gas, and hydro-electricity. [Base Load is the power that is available all the time without interruption. -ag] While “renewable” energy and conservation receive the lion’s share of the media coverage, they make up a minuscule proportion of our total generation.

The United States has invested little in new base-load energy capacity, other than natural gas. Our existing plants are aging. New plants have a long lead-time. If no new plants are started soon, we will have retirements and no reasonably priced options to replace them. This will drive up the total cost of energy [electric rates] and make our economy less competitive.

I see two common views.

• The "Greens" view nuclear plants as a possible solution for greenhouse emissions and a substitute for "dirty" coal.
• The "Engineers" talk about new, efficient plant designs and how technology can help us resolve this situation. The technology in current nuclear and coal plants comes from the 60’s and early 70’s.

I will call my viewpoint “bitter realist”. I have decades of experience with the utility industry, primarily on the financing side, which also requires a fair dose of regulatory experience.

Carl talks about some recent government decisions that are not helpful.

• Obama decided not to fund the Yucca Mountain storage facility in the 2010 budget. This was intended to store spent nuclear fuel after use in electricity generation. It is almost finished after $9 billion spent ($9,000 million).
• The US Government recently selected four companies for Federal loan guarantees for new nuclear plant construction. Why just four, and why these four? Hard to tell. Further, the loan guarantees are small compared to the regulatory demands and future risks.

There is continuing legislative heavy handedness (NRC decommissioning) and ineptitude (Yucca Mountain) which would make any rational investor think twice before investing.

I am a fan of nuclear power and believe that it is a great way to make our country more competitive. Done correctly, it is far cheaper to run in the long term, and reliable under all conditions.

As a “bitter realist”, however, it isn’t going to happen.

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A blog recommended by Carl: Life in the Great Midwest
50+ posts on the energy industry in the US

My Fantasy Beats Your Reality

Reality Versus Leftist Fantasy
06/03/09 - ChicagoBoyz by Shannon Love

[edited] Leftists claim that every economic crisis shows the failure of the free market, and assume that they would never have economic crises. Leftists have a wildly exaggerated sense of their own understanding of the economy and everything else.

The left doesn’t actually have a developed system of thought regarding the economy. They can’t actually explain why the real world political process will make better decisions than the free-market. Instead, they point to any reversals in the real economy, regardless of cause, and assert that in their imaginations leftist politicians could have done better.

Leftists create elaborate fantasies. Then everyone else must argue for reality against the fantasies. The real-world system always comes out worse.

Alternative-energy advocates feel entitled to paper over any shortcomings of their favored technology by evoking future technological breakthroughs. But, they won’t let you postulate future technological breakthroughs that would make current energy sources even more attractive.

If you point out that wind and solar power is unreliable to the point of near uselessness, proponents will breezily respond that future technological breakthroughs in power storage or distribution will overcome the problem.

However, if you point out that developments in nuclear technology could create power systems that would completely recycle their waste, they respond that we should not plan for nuclear power unless we have absolutely proven that the technology works. And, let’s cut funding for the research that would prove it works.

There are More Ways to Go Wrong Than to Go Right
06/19/09 - ChicagoBoyz by Shannon Love

Many leftists debate in this style: “I have an idea and you don’t, therefore I must have the best plan”.

I see this in debates about energy. Some believe fossil fuels cause global warming and nuclear power is too dangerous, so solar and wind power must be viable technologies. Unfortunately, the fact that one specific technology has problems has nothing to do with whether another unrelated technology will work.

The urge to do something, anything, to solve a problem can backfire badly. People immersed in politics begin to think that because there are only two major divisions in our politics, there must be only two altnerate solutions to any problem.

They begin to think that if the idea of one side is bad, then the idea of the other side must be good. If we think that any idea is better than no idea at all, we are more likely to do more harm than good. There are more ways to go wrong than to go right.

Will universal healthcare control costs?
06/16/09 - The Atlantic by Meang McArdle

There have been promised cost reductions for Medicare in the past. Why haven’t they happened, and what has changed to make them feasible now? When I ask this question, I get angry demands that I put forward my plan for cost control, rather than merely critiquing everyone else’s. This seems rather like demanding that I put forward my design for a perpetual motion machine before I am allowed to point out problems in the US energy market.

+ + + +
Magic Power
Could the nerds give us cheap power if they wanted to?

Problems With Green Energy
"Honey, please go up on the roof and sweep off the solar panels."

More on Energy choices ...

Energy Can't Get Here From There

Energy “Plan” - No New Transmission
03/22/09 - ChicagoBoyz by Carl from Chicago

Deception and Policy

[edited] We are allowing our energy infrastructure to deteriorate. The Greens and the Left are disingenuous when they propose their “solutions”, because they don’t want to do anything constructive. They decry “old school” solutions like building new coal plants, which are known, sensible and cost-effective. They promote complicated and unproven alternatives.

This New York Times opinion article shows their duplicity by clearly stating that they don’t WANT to solve the transmission problem, even if someone could wind their way through the rat's nest of financing, legal issues, and permit requirements. The article is a “confession” of their duplicity.

The US has failed to invest much in generation and transmission assets over the last 25 years. “Base load” generation consists of

• Coal plants -- no one is building new ones because of environmental legislation.
• Hydroelectric plants -- no one is damming rivers due to the Sierra Club.
• Nuclear plants -- far too expensive, regulation is uncertain, and Three Mile Island hasn’t gone away.

Even if all the forces were lined up for building generation and transmission, financing is very difficult right now, and the utilities have little incentive to stretch and fund something that the states could invalidate even after giving all the permits to go forward.

The greens and the Left will sabotage any constructive solution. Remember, they dismantled the completely constructed Shoreham nuclear plant on Long Island, pretty much bankrupting the Long Island utility company in the process. Needless to say, the utility had the permits to build it, but the Left played dirty with politics and lawyers and had it disassembled.

The actual platform of the Left is:

• Do nothing about generation.
• Do nothing about transmission.
• Invest a little bit in distribution.
• Talk a lot about conservation.
• Dance for a few years, let the problem get much worse, and hand it to the next administration. Really, it will go to the states, since the Federal government can’t fix the problems, but can make them worse thru legislation.

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Magic Power
Could they do the magic if they wanted to?

Posts about energy.

Obama Team: No Nuclear Energy

Obama Administration: No on Nuclear Energy
03/06/09 - RedState by Francis Cianfrocca

Modern nuclear power can be stopped in many ways.

[edited] Energy Secretary Steven Chu told the Senate Energy and Natural Resources Committee that using the Yucca Mountain underground repository for storing nuclear waste is no longer an option. The proposed budget provides only token funding for the site.

Chu: We have better options than Yucca Moutain for storing commercial nuclear waste.

Providing nuclear waste storage has been a key barrier to expanding nuclear power in America. There are no clear alternatives to the Yucca site. America’s nuclear plants now store their waste on-site, above ground.

Chu and President Obama are saying in veiled language that they will not allow nuclear power to stage a comeback. If these guys get everything they want, America faces a future of much higher energy costs.