Michael Maharrey writes at Peter Schiff’s blog The Inflation Blame Gameexplaining how we got here and how the culprits are deflecting responsibility by accusing others. Excerpts in italics with my bolds and added images. H/T Tyler Durden
Now inflation is Russia’s fault. Or is it greedy businesses pushing up prices? Maybe a combination of the two.
It seems that government officials and central bankers are looking everywhere for a place to pin the blame for inflation except the one place they need to look — in the mirror.
I’m already seeing headlines about how Russia’s invasion of Ukraine is causing inflation. CBS broadcast this storyline on the first day of the invasion. As Peter Schiff put it in a recent podcast, Russia is the latest “excuse variant” for inflation.
It is true that the Russian invasion and economic sanctions have caused some prices to spike. Oil was over $130 a barrel over the weekend. Copper hit record highs. The price of wheat surged. But this is not necessarily inflationary. Inflation causes a general rise in prices across the board. In this situation, some prices will rise while others fall. As consumers spend more on food and energy, they will cut spending on other goods and services. Ostensibly, those prices will drop.
Inflation — an increase in the money supply — causes prices to rise more generally. It’s the result of more dollars chasing the same number of (or fewer) goods and services. As Peter explained, the culprit is the central bank.
“”What makes the prices go up is when the central bank responds to rising energy prices or rising food prices by printing more money, which is what they are going to do. Because as consumers have to tighten their belts because food is so expensive, because home heating oil and gasoline are so expensive, and they cut back spending on everything else, that causes a recession. And that results in the Fed printing more money, and that’s what’s inflationary.”
So, while the Russian invasion is certainly causing prices to rise, government-created inflation is still churning under the surface. In effect, we’re experiencing a double-whammy of rising prices.
Russia is a handy scapegoat for inflation, but “greedy businesses” continue to be the favorite target of central bankers and politicians. As I’ve explained, the narrative continues to grow because the average American doesn’t understand inflation or basic corporate accounting. That includes a lot of the people writing about inflation in mainstream and left-leaning corporate media.
And for politicians, businesses serve as the perfect scapegoat. Americans are already primed to hate big businesses.
During Jerome Powell’s testimony on Capitol Hill last week, virtually all of the Democrats in both the House and Senate repeated the “businesses are causing inflation” narrative. They talked about “record profits” and claimed businesses didn’t need to pass on higher costs. They also talked about a lack of competition.
This behavior is typical of politicians. They cause a problem and then clamor for even more government intervention to “fix” the problem they caused. They want to use inflation as an excuse to increase government regulation and intervention into the economy. Peter pointed out the irony in these congressional hearings.
“You have the chairman of the Federal Reserve that’s printing all the money fielding questions from the congressmen who are spending all the money that the Federal Reserve is printing. So, these are the two partners in crime that are 100 percent responsible for inflation, and they spend the entire hearing talking about how bad inflation is, what a horrible problem it is, and trying to point fingers at who might be to blame, without anybody accepting responsibility that inflation is not here by accident and inflation is not here because some businesses got greedy. Inflation is here for one reason and one reason only. The government isn’t spending money that it collects in taxes. It’s spending money that the Federal Reserve prints.”
If Congress really wants to do something about inflation, it needs to cut government spending. It needs to quit borrowing money and issuing debt that the Fed has to monetize. But obviously, they don’t want to do that. It’s easier to blame Russia or some greedy business than to do what needs to be done.
President Biden also blames everybody but himself for inflation. During the State of the Union speech, the president took credit for helping the economy grow through various government spending programs. But he went on to say a lot of the progress is being undone by inflation — as if inflation has nothing to do with the spending policies.
Biden ignores a critical part of the equation.
When the government spends money on any economic stimulus program, there is a cost. It either has to be paid for by direct taxation or by running a deficit. When the government runs a deficit, either future taxpayers foot the bill, or more often, the Federal Reserve monetizes the debt, prints money and creates inflation. As Peter put it, the government will pay for this government program one way or another.
“Either directly, through an honest tax, or indirectly through a dishonest tax called inflation. So, if Biden wants to claim credit for all this government spending, then he has to claim responsibility for all the inflation that was required to finance it. He can’t pretend that he gave taxpayers all this great stuff but then inflation came and stole it away from them. The inflation came from government. Government stole it. What the government gives with one hand, it takes with the other. So, Biden through government spending programs with one hand reached out and gave taxpayers some money, and with the other hand, he picked their back pocket through inflation to pay for it. So, you can’t say, ‘I love all this government spending,’ but then pretend that the inflation that was a consequence of that government spending had absolutely nothing to do with that inflation.”
That’s why Biden needs a scapegoat. That’s why members of Congress need a scapegoat. That’s why Jerome Powell and his minions at the Fed need a scapegoat. All of these officials need a scapegoat because they need to shift blame for the inflation that they created.
The warning signs are everywhere. We are stumbling toward an energy crisis that is likely to be far more severe and long-lasting than the upheavals of the 1970s. And no, this isn’t about Russia or Ukraine. This is about the perilous state of the U.S. electricity grid.
If action isn’t taken soon to address the unraveling reliability of the grid, the United States will face the specter of rolling blackouts, factory shutdowns, loss of jobs and soaring electricity bills. Our organization CASE recently released a policy brief highlighting just how dire the situation is.
Events In recent years show how serious the situation is. According To the Wall Street Journal, outages have gone from fewer than two dozen major disruptions in 2000 to more than 180 in 2020. The catastrophic blackouts that gripped Texas for a week in February of last year should have been eye-opening. Now, warnings from regulators, grid operators and utilities suggest far worse is coming.
There’s no getting around it. The nation’s electricity transmission system is growing increasingly undependable. Aging infrastructure, severe weather, and the rapid pivot away from baseload power to intermittent solar and wind are all contributing. Supply chain problems and local opposition to building new power lines and siting renewable projects are also turning into increasingly tall hurdles. Expectations of increased demand driven by electric vehicles are only compounding the challenge.
The energy transition is happening but the question we must ask is how do we responsibly manage it? It’s becoming apparent that the transition to renewables is vastly more difficult and complicated than some believed. Those who want to shut down every coal and natural gas plant ignore that fossil fuels supply 60% of America’s electricity. There’s growing alarm the America’s haphazard approach to the energy transition is taking apart the existing grid and the reliable generating capacity that long underpinned it far faster than we’re adding reliable alternatives.
Coal plants, in particular, are being pushed aside when it’s becoming painfully clear the optionality, fuel security and reliability they offer the grid is still very much needed. If we continue as we are – ditching the well-operating power plants that hold the grid together during severe heat and biting winter cold –we’re only going to exacerbate this crisis of our own making.
The affordability of our power supply also hangs in the balance. Last year, a 17% surge in coal-fired electricity helped shield consumers from rising natural gas prices. As we continue to disassemble the coal fleet, with another 100 gigawatts of coal capacity expected to close by 2030, we’re robbing the grid of an important price shock absorber for when natural gas prices rise. With global demand for gas rising, U.S. exports soaring and the Russian invasion of Ukraine throwing volatility into global energy markets, dismantling fuel optionality is short-sighted and reckless.
Europe’s decision to race away from coal and close much of its nuclear power capacity before having reliable alternatives in place, has left it at the mercy of Russian natural gas imports and soaring global gas prices. Energy security – now more so than since the energy crises of the 1970s – requires careful attention.
The singular, haphazard focus of climate-driven energy policy requires an abrupt rethink.
There remains an opportunity for an energy policy reset – both at the state and federal levels – to tackle this reliability and affordability crisis head on. First, we must recognize the need for dispatchable fuel diversity and fuel security. That must also include a commitment to increasing capacity reserve margins in electricity markets instead of letting them continue to shrink. As we grapple with the complexities of the energy transition and the challenges posed by integrating renewable power and building transmission infrastructure, we need a reliability and affordability insurance policy. The insurance we can provide is recognizing the value of the generating capacity we already have and the importance of dispatchable fuel diversity.
Responsibly navigating the road ahead means building on the shoulders of our existing baseload capacity, not taking it apart.
Why is it that we are ruled by the dumbest on the planet? As I have previously stated, there is NO threat that “systematic climate change” is going to change our lives one iota, much less ruin the planet. It is a sham, and Dear Reader, if you don’t understand “what’s up” after witnessing the government’s Covid 19 fear campaign, you get a free membership into the “Docile Non-Thinking Sheep Society.” Baa.
Virtually everything government officials and their foot soldiers told us about Covid turned out to be a lie.
Notice, I did not use, the more diplomatic term “untrue.”They knew they were spreading misinformation and doing everything in their power to cancel anyone exposing their deception.Masks don’t work, but they do deprive one of needed oxygen and cause children to develop speech issues. Prophylactics that could have saved over 500,000 lives were banned and disparaged as “dangerous.” The “Know It Alls” put Covid patients in nursing homes, tens of thousands of non-sick then died. They said you won’t get the virus if you have the vaccine, and that the vaccine would prevent the virus from spreading. “The vaccines are perfectly safe,” evidence is mounting that the CDC and our government elites knew this to be untrue. Millions were prevented from seeing their doctors, visits that would have detected serious illnesses like cancer and heart problems. Thousands died needlessly. Our so called “experts” response to every issue was 180 degrees from what it should have been. “Awake, dear heart, awake. Thou hast slept well. Awake.” As Americans awake from their hypnotic slumber and the Covid “tempest” passes, we should never forget what our government did to us.
Had officials in the federal government done absolutely nothing to combat Covid, many less people would have died.
Instead they purposefully spread fear, and in doing so, it gave them the power to transfer trillions of dollars of wealth to favored constituencies depriving the private sector and market forces to determine the most efficacious uses of these resources. These people shut down millions of businesses and forbid people from going to work or in some areas leaving their homes just to walk down the street. It was likely the stupidest decision in mankind’s history.
These are the same “authorities” lecturing you on “climate change.” Why would you believe anything they say?
Before the advent of fossil fuels, man existed in a Hobbesian world where life was “solitary, brutish, nasty and short.” Slavery and servitude was the norm. The amount of time that has elapsed since Col. Drake drilled the first oil well in 1859 is only 163 years. This represents less than .000543 % of modern man’s existence on earth. In other words, for 99.999467 % of man’s history, man did not harness petroleum products and life absolutely sucked.
In just .000543% of modern man’s existence, life on earth has improved 1,000 fold. An absolute miracle and an impossibly without the oil and gas industry. Americans should erect giant statues of oil rigs in every town square with inscriptions of adulation venerating the industry’s accomplishments and the benefits it has provided humanity. Yet, the absolute stupidest people in the world want to eliminate this fuel source. Unfortunately, moronic people are pretty good at getting elected to office. Dementia Joe and the witless AOC, both stupid on steroids, are now in control of our energy policy. Joe whose family got rich whoring themselves to foreign oil and gas companies, set out to destroy the American oil and gas business on his first day in office. The chickens are coming home to roost as the global consequences of nitwits interfering in these market forces are now apparent. America was energy independent and a net exporter of oil and gas immediately before Brandon’s inauguration. The less energy America produces, the less supply on the world market and the greater the costs. In 2020, the average price of oil was $39.68/barrel. It peaked over the weekend at $130/barrel. In Slow Joe’s State of the Union address, he mentioned that the way to beat inflation is to “Buy American.” That is a ridiculous understanding of economics, as the exact opposite is true, robust worldwide trade reduces prices. But if Joe wants America to buy American, why destroy the American energy sector? It is all being done at the altar of the false god of “Climate Change.” That is how the high priests and apostles of Climate Change think.
Industrial policy where government directs resources to decide winners and losers is always a disaster. It is a “grim” fairy tale. Look at the accomplishments and incredible efficiencies of the oil and gas industry and the combustible engine. Before Sleepy was inaugurated, I could buy a gallon of gas for less than a bottle of water. This gallon of energy was pulled out of the ground as crude oil thousands of miles away, then shipped to a refinery where it was turned into gas, then shipped to the Texaco station 5 blocks from my house. This one unit of energy could power my 5,000 lb. German car, with a carload of occupants and luggage to the next town 25 miles away for less than $2. There are over 150,000 easily accessible and well-located fueling stations around the country and likely an equal amount of repair shops. If my car needs a new fuel pump, I can purchase it online and have it delivered to me the next day. I used to own several gas stations. If a dropped my prices $.05/gallon, every other gas station within 20 miles would follow my lead. There is no industry more competitive and efficient than the oil and gas industry, nor one that provides so much convenience to the consumer, not to mention benefits enjoyed by the entire world. Yet, the “Apostles of Doom” want to destroy it. This entire energy infrastructure was built solely by market forces. There were no pointy-head Harvard grads in the Commerce Department deciding how to extract oil from the ground or where to place gas stations. No government industrial policy made this happen. Zilch, Nada, Zero. It is an amazing testimony to the wonders of capitalism.
Yet, despite the wonderous efficiency of the oil and gas industry, we have stupid people (many are Harvard grads), who ignore the miraculous phenomenon that is right smack in front of their eyes. Why we want to worship the Golden Calf, not the God that delivered us from bondage! The simple-minded charlatans of Climate Change want to wave their magic wand and eliminate this entire industry. Untethered to reality, they think if they click their ruby slippers three times and utter “Renewable Energy” then this new industry magically appears. These are the same dolts who force taxpayers to pay subsidies to Iowa farmers to grow corn for ethanol, a fuel source that reduces gas mileage and damages engines. Brilliant. Only pompous, soft handed, sneering government elitists and their sycophants would think growing food for cars instead of people is a good idea. The “Dolts” know better than the trillions upon trillions of decisions of people voting with their own money who like the current system. It is stupid beyond words, so to achieve their objectives, they must do the Covid 19 Tango and spread lies, fear and deception and then mandate acceptance of their remedy against your will. If one calls them out on their fear tactics that person becomes an enemy of the state. How stupid was it to shut down practically every business in the country during Covid? Astoundingly stupid. How stupid is it to promote electric vehicles stating they reduce our reliance on fossil fuels when all the energy to charge the batteries comes from fossil fuels?
Let me tell you what our national energy policy should be in two words: Do Nothing.
I assume one day; the oil and gas industry might fade away. It might be 50 years or 1,000 years from now. When it does fade away, it will be because market forces allocate resources to new technologies that have not yet been invented or perfected. Maybe it is electric, fusion or nuclear, but it could just as easily be that some West Virginia hillbilly (no offense to hillbillies) invents the new technology by tinkering around in his basement. Having the government misallocate resources through mandated industrial policies just keeps capital out of the hands of the most talented and productive and retards growth and innovation.
So if you are a member of the Docile Non-Thinking Sheep Society, take a deep breath. Now exhale. You just exhaled carbon. It is a natural substance. Without it all life on earth ceases to exist. The planet is not going to implode. Take a chill pill. Get a life. Trade in your girly-man Prius and buy a Hummer.
Russian President Vladimir Putin and Swedish climate activist Greta Thunberg (Reuters)
Western media has stirred up a puritanical revulsion against carbon-based energy, resulting in calls for prohibition of fossil fuels. Leaders in western democracies responded with regulations and constraints punishing companies either producing energy or operating supply infrastructure. This empowers market dominance by sovereign energy nations, some of whom are autocratic, and one of whom just invaded Ukraine.
‘As the West fell into a hypnotic trance … worshiping a teenager named Greta, Vladimir Putin made his moves,’ Michael Shellenberger wrote
In a Tuesday Substack post headlined, “The West’s Green Delusions Empowered Putin,” Shellenberger argued Putin understood economics better than his western counterparts, citing the latter’s incapability of understanding the realities of energy production, and questioned how countries like Germany allowed themselves to become so dependent on an authoritarian country.
“How has Vladimir Putin … managed to launch an unprovoked full-scale assault on Ukraine?” Shellenberger wrote. “There is a deep psychological, political and almost civilizational answer to that question: He wants Ukraine to be part of Russia more than the West wants it to be free.”
“Missing from that explanation, though, is a story about material reality and basic economics—two things that Putin seems to understand far better than his counterparts in the free world and especially in Europe,” he added.
Shellenberger pointed to the differences in energy production and consumption between other European countries and Russia, noting that Europe consumed more energy than it produced, while Russia produced more than it consumed.
“The reason Europe didn’t have a muscular deterrent threat to prevent Russian aggression—and in fact prevented the U.S. from getting allies to do more—is that it needs Putin’s oil and gas,” he wrote.
Shellenberger argued that the focus on “Green ideology” made European countries “incapable of understanding the hard realities of energy production,” and that their moves away from natural gas and nuclear energy gave Putin command over Europe’s energy supply.
“As the West fell into a hypnotic trance about healing its relationship with nature, averting climate apocalypse and worshiping a teenager named Greta, Vladimir Putin made his moves,” he wrote, referencing teen climate change activist Greta Thunberg and noting that Putin expanded nuclear energy and oil production in Russia while western countries obsessed over “carbon footprints.”
Shellenberger specifically used Germany shutting down its nuclear energy production as an example and cited figures showing 47% of the natural gas consumed by the European Union in 2021 being exported from Russia.
“The result has been the worst global energy crisis since 1973, driving prices for electricity and gasoline higher around the world. It is a crisis, fundamentally, of inadequate supply. But the scarcity is entirely manufactured,” he wrote.
“Europeans—led by figures like Greta Thunberg and European Green Party leaders, and supported by Americans like John Kerry—believed that a healthy relationship with the Earth requires making energy scarce,” he added. “In service to green ideology, they made the perfect the enemy of the good—and of Ukraine.”
The controversial Nord Stream 2 pipeline from Russia to Germany was halted following Russia’s invasion of Ukraine last week, something the Biden administration avoided pressing at the request of Germany despite shutting down construction of the planned Keystone XL pipeline from Canada to the U.S. immediately after taking office.
In order to counter Russia’s continued dominance over energy markets, Shellenberger implored Biden to have Germany halt any future shutdowns of nuclear reactors and to have the ones previously shut down turned back on, called on Canada and the U.S. to expand their energy production for increased export to Europe, and argued the U.S. needed to expand the construction of nuclear plants rather than shutting them down.
“Putin’s relentless focus on energy reality has left him in a stronger position than he should ever have been allowed to find himself. It’s not too late for the rest of the West to save the world from tyrannical regimes that have been empowered by our own energy superstitions,” he wrote.
And also, about the miniscule contribution of wind and solar to energize the world today:
Many observations are possible by studying these exhibits. For example, some activists insist that passenger air travel is dangerously warming the planet, and ordinary people should stay home, with flights restricted to essential trips by global elites. A glance at the transportation statistics on slide #2 shows Aviation is only 4% of fossil fuel consumption (12% of 34% FF used for transportation). And aviation includes cargo transport, so passenger travel is a fraction of that.
The bulk of FF transport consumption is Road, meaning cars and trucks, which is why some are demanding electric vehicles be the only means of mobility. Yet a look at slide #6 shows that presently only 10% of electricity comes from Wind, Solar and waste fuels. Furthermore, for all of the investment in wind and solar power, slide #7 shows that so called “green energy”` supplies only 2% of the world’s energy needs.
This video presentation was developed by DW (Deutsche Welle) News, the German international broadcaster. (Later deleted) The theme is described by adding a bit to the title: The Price of Green Energy Will Destroy Us. The message is not about the exorbitant expense so much as the destruction of the world’s environment in order to save it. The imagery in the video is compelling, and for those who prefer reading, I provide below an excerpted transcript in italics with my bolds. H/T Mark Krebs
The video can be viewed at this link:
Climate change, long denied, is now sending shockwaves throughout the world. Citizens are demanding their governments take concrete action. Greta: Why should we study for a future that is being taken away from us? [Applause]
In 2015 the UN climate conference in Paris struck an historic deal. Signatories committed to reducing greenhouse gas emissions. COP 21 President Laurent Fabius: “ I hereby confirm the adoption of the Paris climate agreement.”
The energy transition is in full swing, the future belongs to renewable technologies. Al Gore: This is one of the most impressive and astounding technological revolutions in all of history.
One commodity has become the primary symbol of this new environmental consciousness. “People are convinced, they were convinced that all they have to do is drive an electric car, and that’ll solve all the world’s problems with co2.”
“People are just talking about wind and solar as if that’s going to solve the problem, it won’t.”
What if these supposedly clean energies are nothing of the sort, if they ultimately inflict even more damage on the environment than fossil fuels?
“Everything surrounding us in society is made up of minerals. Basically electric cars are made of metals and minerals, and they need to be mined somewhere.” “ There’s no such thing as clean energy. As long as we’ve got this kind of human behavior, there will also be pollution.”
The energy revolution promises to sharpen the world’s sense of responsibility, but secretly it’s already wreaking its own havoc.
The ecological transition is chiefly economic in nature. An event like the Geneva international motor show makes that abundantly clear. Electric cars are omnipresent. They’re seen as future proof, the new vehicles are touted as green or emissions free.
As the petrol and diesel era nears its end, traditional car makers are reinventing themselves and playing the eco card. The adopters of electric vehicles are people who believe in sustainability. They want to do good for the environment and they want to do their part to contribute to fewer emissions and less pollution, a change in mood that chimes with new environmental requirements. These are COP 21 targets adopted by nearly 200 nations plus the EU.
“We have to meet the co2 emission targets that are set by the European Commission that all of us manufacturers have to make. And they’re becoming more and more stringent. If we don’t meet those targets, there are penalties that will follow and we will have to pay those penalties. And this is what we of course want to avoid.”
This rapid transition comes at a price. By 2023 it’s hoped that 225 billion euros will have been invested in e-cars worldwide. That’s the price of a ticket to tomorrow’s world. CEO VW France: ‘ It’s a future market that so far makes up just a few percent of the overall market but this market will explode. We’re gearing ourselves up for a completely different ballpark. “The electric car will grow from niche product to mass-produced one, and we’ll be offering it at prices everyone can afford.”
If you believe the car makers, the e-car only comes with a list of advantages. It won’t just push up sales, it’ll also protect the environment, a technological miracle. Before too long there’ll be hundreds of millions of these vehicles on the world’s roads. They no longer run on petrol or diesel. But other raw materials are essential in the manufacture of their batteries. Rare metals for example. These metals are already present in many components of our combustion vehicles. For example cerium ensures that windshields can filter UV rays. And we owe the colors and touch sensitivity of dashboard screens to europium and indium.
But in an electric car, rare earth metals play a much more significant role.
They’re crucial for the vehicle’s operation. Without neodymium for example, an e-car wouldn’t even be able to start. Neodymium is used to make magnets; they convert electric energy into mechanical energy, thereby powering the car.
The battery is the heart of an electric car. It constitutes up to 50 percent of the vehicle’s weight and contains cobalt and graphite among other elements. But that’s not all. A battery contains many rare metals, especially lithium, that’s the lightest one. It allows an exchange of electrons which in turn charges or discharges energy.
The auto industry is reliant on these little known raw materials and they’re also present in most other green technologies. It’s not just the e-car that needs rare metals they’re used everywhere for the magnets and wind turbine motors, for example. Rare metals are also crucial for the manufacture of solar cells, for photovoltaic systems. Without them we couldn’t generate any green renewable energies.
Today renewables make up almost 10 percent of worldwide electricity production. As a result of the energy transition wind and solar energy could meet almost half of our electricity needs by 2050. In this greener world, rare metals will be almost indispensable for lighting, heating and transport.
So where do these vital resources come from? Cobalt is chiefly mined in the Democratic Republic of the Congo. Australia Chile and Bolivia all have huge lithium reserves, and Indonesia is a key producer of nickel, zirconium and tin. Today nations on all continents produce many hundred million tons of these raw materials. One country in particular owns vast reserves of strategic resources. China is the dominant producer of these sought after metals. In particular it produces two-thirds of the world’s supply of a mineral that’s especially important to green tech companies: Graphite.
We’re in the far north of the country, in the province of Heilongjiang. Almost unnoticed excavators have carried away an entire mountain right down to the ground water level to secure our green future. Graphite is often produced in ramshackle factories. These men work day and night without adequate clothing or respiratory protection. They’re the miners of the 21st century. Miner: “We know our job exposes us to a health risk but we wear a mask for protection. Breathing this air over a long period of time can give you silicosis, where the lung becomes as hard as stone.”
The fine black dust floating in the air contains hydrofluoric acid. Inhaling large amounts of this caustic contact poison can potentially cause death. “Do you know what this graphite’s used for?” Miner: “For lots of things. For example, these days it’s used in all types of e-cars mainly for electric car batteries.”
The graphite residues are dispersed over many kilometers throughout the surrounding area. Before their very eyes farmers are witnessing a huge toxic carpet of dust building up on the region’s fields. Here the plants no longer sprout any leaves and the soil is losing its fertility.
Farmer: “There’s waste ore lying around everywhere like garbage. Of course we’re upset about it, in fact we’re very upset. They don’t take any responsibility. We can’t do anything. We’re small, if we protest they will take us away in handcuffs. You need to see it with your own eyes to understand.”
Considering how hugely profitable graphite is to Beijing, these people’s lives are of little consequence. And China is home to thousands of storage sites and production facilities for these sought after metals, indium, antimony, gallium, But also tungsten and germanium reserves are plentiful across the nation. China plays a key role on the international market for all these metals. We can assume that in the e-mobility sector alone, demand will rise rapidly over the coming 10 or 20 years for the most sought after rare earths. Demand is growing by up to 25 percent per year
For our society’s energy transition the Chinese are paying with especially severe environmental damage and high loss of human life.
In many mining regions residents have even left their homes. Entire villages were simply given up. Chen Zhanheng: Here many companies only care about cost reduction. These companies don’t treat their waste emissions, slag and wastewater. They dispose of them in secret. The government does carry out checks, but there are ways to cheat the regulations. If an investigation is ordered, the companies play along and follow the rules. But the moment the inspectors are gone, they stop treating their waste and just dispose of it. Behavior like that is irresponsible.” Scott Kennedy: “Central government really would like the mining of minerals to be much more environmentally friendly, but local governments are the ones that either own the mines or are invested in the companies that work the mines. They’re responsible for generating employment, tax payments and growing those local economies. And it’s the local government’s trade off to growing their economy for problems associated with the mining.”
Three thousand kilometers from Heilongjiang, in inner Mongolia, the Chinese have built imposing industrial centers. The industrial sites of the city of Baotou are devoted exclusively to the mining of rare earth elements, a special group of rare metals. The worst environmental damage is caused by the plant’s illegal disposal of waste water. This huge artificial lake on the outskirts of the city is fed by black streams of water containing heavy metals and toxins.
Chen Zhanheng: “Wastewater from the production of rare earth metals is even reaching the groundwater, and in some places this water is being used, but of course that’s problematic. It can be very harmful to people because it contains fluorine, for example, that makes our bones brittle raising the risk of fractures. Slag can contain radioactive thorium, which is also reaching the groundwater and spreading slowly from there. Alternatively it’s stirred up as dust by the wind and settles everywhere in the town or village. That’s how radioactive pollution occurs.
Around Baotou thousands of former villagers have begun a new life in soulless sleeper towns. They’re green technologies’ first refugees. One of them is Gao Sia. The farmer had to give up her farm, the health risks were simply too great. Gao Sia: “Our livelihoods have been ruined. Young people earn a bit of money with casual work. Their families have nothing and they can’t support them. The water we use to wash and clean dishes every day is totally white. It’s so bad the tap’s blocked, nothing comes out. People are getting cancer, a large number very many. The metals they produce aren’t harmful, they’re sold for a great deal of money. But the mining creates wastewater and pollution.”
These new instances of environmental pollution on the other side of the world are the price for our wind turbines, our solar panels and our clean cars, improving air quality in Europe.
The paradox is that greenhouse gas emissions continue to exacerbate climate change all around our planet. Engineer: To make something clean you always have to pollute something else. There’s no such thing as a co2 free and 100 % ecological product, regardless of what we might sometimes read on the label. It’s impossible, there’s always going to be a knock-on effect. If we want to see what pollution looks like, the environmental damage caused by our ever so clean products which we like to believe are made by workers in white coats, then we only need to look at industrial zones in China or elsewhere.”
Our green technologies don’t just contain rare metals, they require metals of all kinds including the most widespread.
A wind turbine consists of an average 20 tons of aluminum and up to 500 tons of steel. An e-car contains up to 80 kilos of copper, four times more than in some combustion vehicles. This reddish-brown metal is especially important for green tech companies. Jean-Marc Sauser: “The energy transition is consuming huge amounts of copper, not just in the construction of wind turbines, but also in the connector cables that link the turbines to each other and the grid. The electricity has to reach its target destination after all. If you want electric cars, then you need charging points everywhere. For that you have to lay copper cables, and that’s what’s happening at the moment. Olivier Vidal: “If you take copper for example, it gives us a clear illustration of what’s going on. Since the beginning of time humanity has produced between 800 million and a billion tons of copper. If we continue on this current growth trajectory will produce the same amount in the next 30 years. We’ll have to produce as much copper in three decades as we’ve consumed since the beginning of time. The demand is huge.”
This increased demand for regular metals such as copper means many other nations are affected by the energy transition. To gauge the full extent of the impact we need to travel thousands of kilometers to South America. We’re in northern Chile. Chuquicamata is the world’s largest open pit copper mine, which is publicly owned. Its vast crater has a diameter of four kilometers and is more than one kilometer deep. Increased worldwide demand means more laborers and more machines. Production Director: “Last year we refined 330 000 tonnes of copper here in Chuquicamata. It’s pure copper ready for the market. Once we start mining underground as well, we expect to refine 470 000 tons of copper in Chuquicamata. It’ll be an historic year for the mine, 470 000 tons.”
Thirteen percent of the world’s copper reserves are found here in Chuquicamata, but the deeper the machines dig the less metal they’ll find in the ground. At the current pace of extraction, there are already signs that demand may outstrip supply. Olivier Vidal: “Geologists are warning of a copper shortage that could take hold in just a few years. Pessimistic analysts are predicting a spike in production from 2030 to 2040. In other words today, followed by a decline in primary copper production.”
Just like China’s graphite industry, the copper mines of Chuquicamata are polluting the earth and water with heavy metals. Almost 10 percent of all jobs in Chile depend on copper extraction. The environmental damage caused by mining is completely ignored Mayor of Tocopilla: “We have a water problem, a serious consequence of the mining and industry in this region.”
This is because mining and processing the mineral requires huge volumes of water. It’s thought that Chuquicamata uses 2000 liters per second. This, although in many parts of this arid desert it hasn’t rained for five hundred years. Damir Galez, Historian: “The mining industry siphons off most of its water from wetlands and groundwater the water consumption is enormous.” Mayor: “The water is practically running dry because more is being taken than nature can produce. The natural water reserves of our region are being excessively exploited by mining.”
To get a handle on the actual environmental impact, it’s necessary to examine not just mining itself, but the system as a whole.
The contaminated area covers several thousand square kilometers. Antofagasta is four hours by car to the southwest of the Chuquicamata mine. The town’s population is used to the daily rumble of trains and trucks bringing the copper to this industrial port. From here the metal is exported all over the world. The air is thick with heavy metal particles released by the vehicles without anyone really noticing.
Although the mine is far away, it has brought disproportionate levels of ill health to the 200 000 people who live in Antofagasta. In 2016 this doctor published a study that to this day has been ignored by the copper industry. Health Authority: “We studied contamination levels on the roofs of schools and kindergartens where we found a high concentration of heavy metals. In other parts of Chile people mainly die of cardiovascular disease.In the North the main cause of death is cancer, in particular lung cancer. A link to the contamination is indisputable. In some districts of Antofagasta 10% of residents have cancer.”
And producing electricity for the Chuquicamata mine inflicts further damage on people and the environment. To assess the full extent of the problem we’re traveling almost 300 kilometers to the north. Sandwiched between desert and sea the little town of Tocopilla appears cut off from the outside world. Isulina Jerez has lived here all her life. Ten years ago one of her sons died of lung cancer; he was just 17 years old. Isulina Jerez: “As much as I’ve tried to find an explanation, I see no reason why my son who never smoked and always led a healthy life died at the age of just 17. He was very active and sporty, he was the healthiest of all my children. Then the cancer came and carried him off.”
It’s often difficult to breathe in Tocopilla, the cause of the problem is producing power for the insatiable mine of Chuquicamata. Chile has 28 coal-fired power stations. The government put one of them is here in this tiny town on the pacific coast.
40 percent of Chile’s electricity is gleaned from this fossil fuel. The toxins released in the process have already led to high rates of cancer. Entire systems are being sacrificed: the land, nature, and people’s health. In turn these sacrifices benefit other regions who profit from them. There people can afford the luxury of cleaner, healthier, greener and more renewable energy. But other people pay the price for that.
Damir Galez: “There’s copper here but no coal. That’s brought from many thousands of kilometers away coming from Colombia and New Zealand. The procurement process does of course have an impact. For example, at the coal mines in Colombia, the populations there are exposed to a high concentration of heavy metals in the air. And the ships that transport the coal pollute the sea. The coal travels thousands of kilometers before it arrives in Tocopilla. That requires a well-developed network of mines, ports, trains, ships and thermal power plants. At the end you’ve got the copper mine.
Copper mining takes place in the dark and what you don’t see of course doesn’t count for anything.
But the company that runs the coal-fired power station in Tocopilia claims green credentials. The multinational has even declared itself world market leader for co2 free technologies. The company in question is Engie based in France. Damir Galez: “During my time in France I was able to observe the big contradiction in all of this. There Engie presents itself as a clean company promoting renewables and always prioritizing sustainability. But this sustainability in Europe, particularly in France has a very dark side: Electricity production.
To be able to generate electricity in Chile, the French energy company operates six coal-fired power plants there, a seventh has been under construction since 2015.
SrVP Engie: “We’re helping the Chilean government. Instead of closing the power stations, which would halt factories and trains and plunge the nation into darkness, we aim to support Julia’s (Julia Wittmayer) EU energy transition. It’s about finding the right moment for the construction of new plants in the renewable sector. We’re working a great deal with solar and wind power and we’d like to support the government in this conversion. That’s our mission and our responsibility.
Damir Galez: But you’re still building a new coal plant in northern Chile.
SrVP Engie: “As i just said Engie’s task is to support the government and we’re currently doing just that. It’s impossible to decommission all coal plants as long as they supply 40 percent of the national demand for electricity. That’s the case in Chile: Without this 40% industry would grind to a halt. We’re supporting the conversion to renewables and a reduced electricity consumption.
Nicolas Meilhan: The eco car has become a kind of religion. If we now can see that maybe it isn’t the be-all and end-all, and the same could be said for solar cells and wind turbines to a certain extent, then all the governments talk about the electric car that’ll save the world will come crashing down like a house of cards. In 20 years we’ll wake up because harmful emissions will have continued to rise and the e-car won’t have changed anything. The next energy crisis is already in the making: ElectricGate.
But at the Geneva motor show, car makers have other things on their minds. New brands are jostling for attention in a promising market. Volvo for example has founded a subsidiary dedicated to making electric cars with a carefully thought out marketing campaign pledging that by purchasing its models we’re saving the planet.
Global automotive industries annual revenue is 2 000 billion euros.
That’s equal to the GDP of a nation like France. With that in mind, very few car makers are prepared to look reality in the eye. VP Lexus: “ It’s probably an interim solution, but is it also the best long-term solution? I’m not sure about that because if we’re just talking about purely electric vehicles, we can’t just be looking at the car itself. We also need to consider the issues of battery and electricity production. And in many nations the latter isn’t particularly ecological. That’s a global problem.”
So does the future of green energies lie in further innovations? That’s what car makers are promising at least. SrVP Engie: “The energy transition isn’t over, there are still many innovations to come. We’ve invested in startups that want to develop new technologies, organic solar cells for example. They’re very different from regular cells because they don’t need any silicon. Organic solar cells are like a sheet of paper, very flexible; they can be installed anywhere. If we fixed these thin film cells to all large office blocks we could generate an incredible amount of electricity.
Olivier Videl: “Some key technological developments have the potential for enhanced effectiveness. Performance will improve through research in this area. Despite everything we should throw our weight behind these technologies, because they’re ripe for development.”
Chile has pledged to shut down all its coal plants, but not before 2040. So Engie won’t be able to address the contradiction between its green washing and the bleak Chilean reality anytime soon.
Comment
This abridged transcript excludes the ending message which devolved into a Malthusian appeal, echoing the Club of Rome’s Limits to Growth. The video nailed the essential point: Obsession with e-cars in particular, and non-carbon energy in general will destroy the planet in the guise of saving it. The hypocrisy is dripping from those who terrorize the world with fears of global warming and point to zero carbon as the solution. They get all righteous and indignant at car companies who organized to profitably produce e-cars to meet the demand the warmists created. They expose their quaint naivete that people can be supplied with goods without any profit incentive. The dangerous obsession has three components.
The Transition to Zero Carbon is Unnecessary
Earth’s weather and climate changes are within the range of historical variation. In particular, there has been no accumulation of warming in the last four decades. The rising CO2 in the air has been a boon to the biosphere and to crop production.
Replacing Fossil Fuels with Zero Carbon Energy is Impossible
Presently, despite all of the money invested in them, Wind and Solar power supply 2% of the world’s energy needs. The renewable energy solution does not scale to the desired outcome of reducing fossil fuel usage to any meaningful extent.
The Attempt to Electrify Everything Will Bring Environmental Desolation
Trying to power modern societies with intermittent wind and solar power will extract planetary resources to depletion. The landscapes of Northern China and Northern Chile will become typical rather than extreme situations to be managed. The imaginary climate problem will not be solved, but the environmental catastrophe will be all too real, and of our own making. Cease and desist this madness.
Raymond has produced another in his Simple Science series, this one providing images explaining how the world uses its energy and where the energy comes from. It’s a pictorial representation of statistics compiled by the International Energy Agency (IEA) in their 2020 World Report, the latest year being 2018.
World of Energy, World of CO2, and World of Climate Change are projects at RiC-Communications, based in Zurich. The exhibits are available for download at the following linked titles:
In addition there is an introductory video to the CO2 series The three titles above link to summary posters suitable for printing. In addition there a some charts related to water and ice:
Energy consumption is an important topic and on everyone’s lips. Since fire has been used as an energy source, fossil fuel use has played an important role in the evolution of our species. The rise of carbon in our atmosphere can be traced back to the beginning of industrialization and contributes in part to today’s levels of 420 ppm. Fossil fuels account for 81% of our total energy supply, a dependence that has not diminished to this day. This valuable resource drives the global economy and helps to reduce poverty worldwide. However, fossil fuels are not evenly distributed across the world and have always been the source of conflict or leverage. Renewable energy is becoming more popular, but efforts to replace the high density of fossil fuels will not be easy.
– N° 1 Global Energy consumption in percent by all sectors
– N° 2 Global Fossil fuel consumption in percent by sector
– N° 3 Oil consumption in percent by sector
– N° 4 Natural Gas consumption in percent by sector
– N° 5 Coal consumption in percent by sector
– N° 6 Electricity Generation by Source
– N° 7 Total energy supply by source
Comment
Many observations are possible by studying these exhibits. For example, some activists insist that passenger air travel is dangerously warming the planet, and ordinary people should stay home, with flights restricted to essential trips by global elites. A glance at the transportation statistics on slide #2 shows Aviation is only 4% of fossil fuel consumption (12% of 34% FF used for transportation). And aviation includes cargo transport, so passenger travel is a fraction of that.
The bulk of FF transport consumption is Road, meaning cars and trucks, which is why some are demanding electric vehicles be the only means of mobility. Yet a look at slide #6 shows that presently only 10% of electricity comes from Wind, Solar and waste fuels. Furthermore, for all of the investment in wind and solar power, slide #7 shows that so called “green energy”` supplies only 2% of the world’s energy needs.
Following a Biden Executive Order, in April 2021 several states went to Louisiana District Court to stop implementation of Social Cost of Carbon with respect to federal regulations. The Memorandum Ruling regarding that case is State of Louisiana et al Versus Joseph R. Biden Jr. et al. The Plaintiff States are Louisiana, Alabama, Florida, Georgia, Kentucky, Mississippi, South Dakota, Texas, West Virginia, and Wyoming. Excerpts in italics with my bolds. H/T Francis Menton
The Issues
The Plaintiff States seek injunctive and declaratory relief on three grounds.First, they assert that the SC-GHG Estimates violate the procedural requirements of the Administrative Procedure Act (“APA”) as a substantive rule that did not undergo the requisite notice-and-comment process. See 5 U.S.C. § 553.
Second, the Plaintiff States claim that President Biden, through EO 13990, and the IWG lack the authority to enforce the estimates as they are substantively unlawful under the APA and contravene existing law. See 5 U.S.C. § 706(2)(A)–(C).
Third, the Plaintiff States maintain that the Government Defendants acted beyond any congressional authority by basing regulatory policy upon global considerations.
The Plaintiff States request a preliminary injunction: (1) ordering Defendants to disregard the SC-GHG Estimates and prohibiting them from adopting, employing, treating as binding, or relying upon the work product of the Interagency Working Group (“IWG”); (2) enjoining Defendants from independently relying upon the IWG’s methodology considering global effects, discount rates, and time horizons; and (3) ordering Defendants to return to the guidance of Circular A-4, explained infra, in conducting regulatory analysis.
To be clear, the Court is ruling only on the actions of the federal agencies and whether the agencies, by implementing the estimates and considering global effects— violate the APA and whether President Biden upon signing EO 13990, violated the separations of powers clause of the United States Constitution. The Court has the authority to enjoin federal agencies from implementing a rule—mandated by an executive order or not—that violates the APA or violates the separation of powers clause. Importantly, the Court is not opining as to the scientific issues regarding greenhouse gas emissions, their effects on the environment, or whether they contribute to global warming.
The Findings
The Court is persuaded that the Biden Administration’s agencies are using the SCGHG. The Court finds that the Plaintiff States have established injury-in-fact.
Plaintiff States argue that the SC-GHG Estimates “affect[] the states’ ‘quasi-sovereign’ interests by imposing substantial pressure on them to change their” practices and laws to remain in compliance with federal standards. Id. at 153. The Court finds that the Plaintiff States also have standing as they are entitled to special solicitude in the standing inquiry.
The Court finds that EO 13990 contradicts Congress’ intent regarding legislative rulemaking by mandating consideration of the global effects. The Court further finds that the President lacks power to promulgate fundamentally transformative legislative rules in Case 2:21-cv-01074-JDC-KK Document 98 Filed 02/11/22 Page 33 of 44 PageID #: 4175 Page 34 of 44 areas of vast political, social, and economic importance, thus, the issuance of EO 13990 violates the major questions doctrine.
The Court finds that EO 13990 was promulgated without complying with the APA’s notice and comment requirements.
The Plaintiff States thus argue that they have demonstrated multiple independently sufficient grounds to vacate the SC-GHG Estimate and therefore have shown a strong likelihood of success on the merits. The Court agrees and finds that the Plaintiff States have shown a strong likelihood of success on the merits.
Plaintiff States have sufficiently identified the kinds of harms to support injunctive relief. Moreover, the Court finds that the Plaintiff States have made a clear showing of an injury-in-fact, and that such injury “cannot be undone through monetary remedies,” Louisiana v. Biden, 2021 WL 2446010, at *21 (W.D. La. June 15, 2021), such that they need immediate relief now, lest they be unable to ever obtain meaningful judicial relief in the future.
The Court finds that the balance of the injuries weighs substantially in favor of the Plaintiff States.
The Court agrees that the public interest and balance of equities weigh heavily in favor of granting a preliminary injunction.
CONCLUSION For the reasons set forth herein above, the Motion for Preliminary Injunction will be granted in its entirety.
Comment from Manhattan Contrarian
On taking office, the Trump administration took steps to neutralize the SCC, so that not much has been heard from it for a while. But Biden’s EO 13990 caused the Obama-era version to get re-instated. The Biden people claim that they are working on further tweaks to the regulations, but meanwhile a large group of Republican-led states went ahead and commenced litigation.
With a regulatory initiative obviously intended to force a gigantic transformation of the economy without statutory basis, the Biden people defended against the Complaint using every shuck and jive and technicality known to man. The SCC rules were not “final” because the administration was still working on a few more tweaks (and then a few more, and then a few more); the state plaintiffs lacked “standing” because the harm was to citizens rather than the state itself; and so forth. The court was having none of it.
The heart of the court’s decision is its determination that the SCC falls under the Supreme Court’s “major questions doctrine,” under which the bureaucracy cannot on its own authority impose “new obligations of vast economic and political significance” unless Congress “speaks clearly.” The states had identified some 83 pending projects involving something in the range of $447 and $561 billion dollars as affected by the SCC rule. That impressed the court as easily within the concept of “major questions.”
We are at the beginning of what could be a very long battle. The bureaucracy has many ways to wear down its opponents. For example, a permit can simply be delayed indefinitely, without any reason being stated, as occurred for example with the Keystone XL pipeline. But at least here battle lines have finally been drawn.
Yesterday New Englanders had reason to feel a little more … European than usual. that’s because according to Department of Energy data they were paying a spot price of $30.5 per million British thermal units for natural gas.
This is an absurd price, in line with what Europeans, facing their worst energy crisis in a generation, have been suffering in recent months. To put it in context, $30.5 per mmBtu is the equivalent of paying $180 for a barrel of oil (double what it is today), or 20 cents per kilowatt-hour for electricity. In other words: nuts.
Project abandoned in 2017 after New York blocked planning and permit processes.
How much are Bostonians getting shafted on natural gas? By comparison, the spot price of gas on the Gulf Coast of Texas and Louisiana yesterday was $5.50 per mmBtu (the energy equivalent of about $33/bbl oil). This price spread is exceptionally wide, nearly unprecedented.
But it’s easily explained — by the perennially misguided energy policy in New England.
Just 200 miles to the south, beneath western Pennsylvania, lay the nation’s biggest gas field — the Marcellus shale. From practically nothing 15 years ago, the Marcellus now provides roughly a third of America’s gas supply, more than 30 billion cubic feet per day. America’s shale gas fracking boom is the primary reason why the nation has been able to dramatically switch away from dirtier coal, and cut overall carbon dioxide emissions by nearly 20% — more than any other leading economy.
Project abandoned in April 2016
But very little Marcellus gas flows to New England, because NIMBYs and their politicians have blocked construction of pipelines. Yet the region still relies on cleaner-burning gas to fuel power plants. Over the weekend, when New England was walloped by snow, its power grid was running 37% natural gas, 22% oil, 22% nuclear, 11% renewables, 6% hydro power, and less than 1% coal. (See current mix here.)
Electrical power resource mix from ISO-New England
And yet how does New England get its gas? Nearly all of it comes by ship, in giant insulated tankers carrying -260 degree condensed liquefied natural gas, most of which dock at the Everett LNG regasification terminal in Boston harbor, owned by Exelon Generation.
Where’s that gas come from? Despite more than $50 billion of recent investment into LNG liquefaction plants in Texas and Louisiana, you won’t find any American freedom gas being delivered into Boston. Instead, because of a law called the Jones Act (which requires ships carrying goods from one U.S. port to another to be U.S. owned and flagged), the gas that lands in Boston has historically been sourced from fields in Trinidad & Tobago, Norway, and Russia.
Which is why New England is now paying through the nose for gas. Or rather, they are paying the international price — in line with LNG spot prices in Tokyo, Shanghai, and Europe.
Is it reasonable that New England’s natural gas price depends on decisions made in Europe to shut down nuclear power plants, turn off the flows from giant fields like Holland’s Groningen, and rely on Gazprom to maintain flows from Russia? Of course not. But without more pipelines from the Marcellus (or solar panels and wind turbines covering every hillside), this is the reality, this is how New England ends up burning oil to generate a fifth of its wintertime electricity.
If you live in the northeast how can you personally arbitrage this market madness? Make sure you fill up heating oil tanks in the off-season, chop your own firewood, and buy shares in natural gas producers and exporters.
Ayaan Hirsi Ali explains how Energy has become the first and foremost world public concern in her Spectator article Energy is the most important issue in the world. Excerpts in italics with my bolds and added images.
Gas prices are climbing, Russia is building pipelines, yet we’re focused instead on appeasing climate activists
One issue more than any other will dominate airtime and influence policy in 2022: energy.Americans are seeing the highest prices at the pump in seven years. Since Biden took office, average gas prices are up by more than $1 a gallon. In November, gas prices in Mono County, California hit more than $6 per gallon, forcing some residents to drive to Nevada (where gas taxes are lower) to buy fuel.
The price of natural gas in the US is at its highest in seven years, and up more than 180 percent in the last year alone. In Europe, the situation is even worse.
Europe’s gas reserves are at record lows. In Germany, which already had the EU’s highest energy prices, bills are up 30 percent in a year. If the European winter is harsh, supplies for heating homes and businesses may have to be rationed.
Domestic energy is a foreign policy issue. The threat of a Russian attack onUkraine was one of the factors driving gas prices up in late 2021. In December, Annalena Baerbock, Germany’s foreign minister, warned that if Russia invaded Ukraine, the Nord Stream 2 natural gas pipeline from Russia to Germany “could not come into service.” That would mean serious shortfalls in Germany’s energy supply this winter, as Germany is dependent on Russian natural gas. Germany’s economic affairs minister, Robert Habeck, now calls Germany’s assent to Nord Stream 2 a “geopolitical mistake.” Days before Christmas, Russia reversed flows on Yamal, another pipeline to Germany. European energy prices reached new peaks. Russia claimed the reversal had no “political implications.”
Europe is splitting over nuclear power as the answer to secure supplies of green energy. France pushed to classify nuclear energy as “sustainable,” a move that would unlock billions of euros in state aid and private investment, earmarked for green energy. An EU proposal was recently put forward to do just that — despite opposition from Germany, which threw its lot in with Nord Stream 2 and Putin’s natural gas under Angela Merkel.
And don’t forget Iran. Its march toward acquiring nuclear arms creates severe vulnerabilities for the US and its allies — especially Israel, but also the oil-rich Gulf states.China continues to underwrite the regime in Tehran by purchasing Iranian oil and evading and ignoring US sanctions.
Energy will determine elections in Europe and the US in 2022 and beyond. It will determine foreign policy decisions. It will be an overarching and enduring theme for years to come. But energy has always been part of the conversation. What makes this year different? Wasn’t there an even bigger energy crisis in the 1970s?
The answer to both those questions is this: unlike in the past, our current energy crisis derives from our own mistakes. We’ve put all of our eggs into the basket of renewable energy, but its promise has been oversold. The costs of solar and wind power generation may have fallen, but they cannot provide stable energy sources because of fluctuations in the weather. That tends to reduce the overall efficiency of power grids.
The green movement also underestimates the true costs of renewable energy. As Michael Shellenberger explains, a wind farm requires 370 times more land than a nuclear plant does. If we shift away from nuclear energy and toward renewables as Joe Biden’s climate plan proposes, the impact on America’s natural environments would be devastating. Yet the Biden administration remains committed to renewables as a “green” solution.
After Angela Merkel phased out nuclear plants almost entirely, Germans now pay the highest energy costs in Europe, not least because a renewables surcharge of 20 percent is added to their bills. The various European and British decisions to ban fracking have had similar effects on the cost of heating a home. The effect of opposition in the US will be no different.
Fracking played a key part in the US’s transition from coal to natural gas, which led to significant reductions in American emissions of carbon dioxide. But some Democratic-run states are attempting to ban fracking entirely through legislation and, as in California, denying permits. Shale oil production barely grew in 2021, and we are unlikely to see a fracking revival in the near future. A return to energy dependence on other countries is becoming unavoidable. We’ve seen this already: in November, Biden appealed to OPEC to increase production.
Americans and Europeans have become so focused on appeasing climate activists that they’ve forgotten the importance of power — in the sense of geopolitics, not kilowatts. While the West was debating ways to reduce emissions at the UN’s COP26 summit in Glasgow, Russia and China didn’t even bother to show up. While we fall over ourselves to acclaim Greta Thunberg, Russia builds strategic gas pipelines and China builds coal-burning power stations.
The politics of energy will impact the lives of everyone this year, the poor especially. To avoid a new self-inflicted energy crisis, unlike in the 1970s — the West must reassess the costs of the “green transition.” We need a strategy that generates power efficiently, and without handing geopolitical power to our strategic rivals.
At this current crazy moment, most of the “Western” world (Europe, the U.S., Canada, Australia) is hell bent on achieving a “net zero” energy system. As I understand this concept, it means that, within two or three decades, all electricity production will be converted from the current mostly-fossil-fuel generation mix to almost entirely wind, solar and storage.On top of that, all or nearly all energy consumption that is not currently electricity (e.g., transportation, industry, heat, agriculture) must be converted to electricity, so that the energy for these things can also be supplied solely by the wind, sun, and batteries. Since electricity is currently only about a quarter of final energy consumption, that means that we are soon to have an all-electric energy generation and consumption system producing around four times the output of our current electricity system, all from wind and solar, backed up as necessary only by batteries or other storage.
A reasonable question is, has anybody thought to construct a small-to-moderate scale pilot project to demonstrate that this is feasible? Before embarking on “net zero” for a billion people, how about trying it out in a place with, say, 10,000, or 50,000, or 100,000 people. See if it can actually work, and how much it will cost. Then, if it works at reasonable cost, start expanding it.
As far as I can determine, that has never been done anywhere. However, there is something somewhat close. An island called El Hierro, which is one of the Canary Islands and is part of Spain, embarked more than a decade ago on constructing an electricity system consisting only of wind turbines and a pumped-storage water reservoir. El Hierro has a population of about 11,000. It is a very mountainous volcanic island, so it provided a fortuitous location for construction of a large pumped-storage hydro project, with an upper reservoir in an old volcanic crater right up a near-cliff from a lower reservoir just above sea level. The difference in elevation of the two reservoirs is about 660 meters, or more than 2000 feet. Here is a picture of the upper reservoir, looking down to the ocean, to give you an idea of just how favorable a location for pumped-storage hydro this is:
The El Hierro wind/storage system began operations in 2015. How has it done? I would say that it is at best a huge disappointment, really bordering on disaster. It has never come close to realizing the dream of 100% wind/storage electricity for El Hierro, instead averaging 50% or less when averaged over a full year (although it has had some substantial periods over 50%). Moreover, since only about one-quarter of El HIerro’s final energy consumption is electricity, the project has replaced barely 10% of El Hierro’s fossil fuel consumption.
Over at the website page for production statistics, it’s still more excitement about tons of carbon emissions avoided (15,484 in 2020!) and hours of 100% renewable generation (1293 in 2020!). I think that they’re hoping you don’t know that there are 8784 hours in a 366 day year like 2020.
So why don’t they just build the system a little bigger? After all, if this system can provide around 50% +/- of El Hierro’s electricity, can’t you just double it in size to get to 100%? The answer is, absolutely not. The 50% can be achieved only with those diesel generators always present to provide full backup when needed. Without that, you need massively more storage to get you through what could be weeks of wind drought, let alone through wind seasonality that means that you likely need 30 days’ or more full storage.
Then take a look at the picture and see if you can figure out where or how El Hierro is going to build that 40 times bigger reservoir. Time to look into a few billions of dollars worth of lithium ion batteries — for 11,000 people.
And of course, for those of us here in the rest of the world, we don’t have massive volcanic craters sitting 2000 feet right up a cliff from the sea. For us, it’s batteries or nothing. Or maybe just stick with the fossil fuels for now.
So the closest thing we have to a “demonstration project” of the fully wind/storage electricity has come up woefully short, and really has only proved that the whole concept will necessarily fail on the necessity of far more storage than is remotely practical or affordable. The idea that our political betters plow forward toward “net zero” without any demonstration of feasibility I find completely incomprehensible.
“As the West fell into a hypnotic trance about healing its relationship with nature, averting climate apocalypse and worshiping a teenager named Greta, Vladimir Putin made his moves,” he wrote, referencing teen climate change activist Greta Thunberg and noting that Putin expanded nuclear energy and oil production in Russia while western countries obsessed over “carbon footprints.”
Science Matters 