Climate & Energy

Gas prices to peak soon?

EIA: Making the same mistake again and again

If you believe the Energy Information Administration, U.S. gas prices will peak at $4.15 per gallon in August. Whew. That's a suprise for most Americans, 86 percent of whom believe that prices will top $5 by the end of the year. We can be confident that the EIA -- the agency that does the country's official projection of oil prices -- knows what they're talking about. Yessiree. If you detect a note of sarcasm in my post maybe that's because the EIA has a hilarious record of forecasting world oil prices. And even when it comes to domestic gasoline prices, it's as if their forecasts are completely impervious to reality. To wit:

Notable quotable

Toyota and Honda could sure learn something from Chevy!

“I don’t have to tell you how sexy the [Chevy] Volt is. The Japanese and Chinese couldn’t possibly put out something that appealing to middle …

The price isn't right

Nuclear power is expensive

In mid-2007, a Keystone Center nuclear report (PDF), funded in part by the nuclear industry estimated capital costs for nuclear of $3600 to $4000/kW including interest. The report notes, "the power isn't cheap: 8.3 to 11.1 cents per kilo-watt hour." In December 2007, retail electricity prices in this country averaged 8.9 cents per kwh. Mid-2007 has already become the good old days for affordable nuclear power. Jim Harding, who was on the Keystone Center panel and was responsible for its economic analysis, e-mailed me in May that his current "reasonable estimate for levelized cost range ... is 12 to 17 cents per kilowatt hour lifetime, and 1.7 times that number [20 to 29 cents per kilowatt-hour] in first year of commercial operation." At the end of August, 2007 Tulsa World reported that American Electric Power Co. CEO Michael Morris was not planning to build any new nuclear power plants. He was quoted as saying, "I'm not convinced we'll see a new nuclear station before probably the 2020 timeline," citing "realistic" costs of about $4,000 per kilowatt. So much for being a near-term, cost-effective solution to our climate problem. But if $4,000 per kilowatt was starting to price nuclear out of the marketplace, imagine what prices 50 percent to 100 percent higher will do.

Maintaining relations

Council on Foreign Relations releases new report on climate change and U.S. policy

The Council on Foreign Relations released a new report this week on how the United States should approach foreign policy as it relates to climate …

Guess I won't be seaing you

Arctic sea ice update: 2008 poised to repeat — or beat — 2007

For months, the deniers have been extolling the fact that the Arctic sea saw record refreezing last fall. And they have been claiming that this somehow fits into the absurd claim that the planet is now in a major cooling trend. But back in the real world, the planet keeps warming, and the Arctic is taking the worst of it, which could lead to potentially catastrophic methane emissions from the tundra, as noted here. The National Snow and Ice Data Center just reported:

Oh say can you CCS?

Boucher and Upton introduce bipartisan legislation to invest in carbon sequestration technology

House Energy and Air Quality Subcommittee Chairman Rick Boucher (D-Va.) and ranking minority member Fred Upton (R-Mich.) introduced industry-backed legislation on Wednesday to invest billions …

As corn and soy fields drown in rainwater, the food crisis deepens

A cornucopia of bad circumstances. Here in the United States, we grow 44 percent of the world’s corn crop, and 38 percent of its soy. …

Against cap-and-dividend

Peter Barnes’ carbon policy proposal would not spur the economic changes we need

I should preface by saying that I am a fan of Peter Barnes. He's an emeritus board member of Redefining Progress. He's a smart and thoughtful guy. But I'm not a fan of his cap and dividend idea, mostly from an economic perspective. First, the idea that a price on carbon would be transformative, and that we should do that first and then come in with other complementary policies later, is dangerously wrong. Transportation and building heating/electricity are the two largest contributors to carbon emissions, accounting for well over half the total. The price elasticity on transportation fuels is very low, as we've seen. With gas prices up $2 per gallon in the last three years, we're now finally seeing small reductions in driving, somewhere in the neighborhood of 4%. $2 per gallon of gas is roughly the equivalent of $200 per ton of carbon, a price impact that the failed Lieberman Warner bill wouldn't have brought until beyond 2040, if then. Home energy use is not only terribly price inelastic (people light and heat their homes out of habit and necessity, not on the basis of price), so that we'd need very high prices to induce behavior changes, but is also characterized by a terrible market failure in information, where people have no idea what appliance costs them what in terms of electricity. As everyone should now be aware, rental units are subject to other serious energy market failures due to renter/owner split incentives and the liquidity constraints of many renters.

e360 and states

New Yale green site draws attention to state climate efforts

I think various Grist contributors have linked over there a few times already, but I’ve been remiss in not explicitly noting the debut of environment360, …

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