Skip to comments.World must wake up to the dangers of biofuels, head of Kew Gardens warns (Solution is a problem)
Posted on 09/09/2006 2:53:33 PM PDT by DaveLoneRanger
Link Only: World must wake up to the dangers of biofuels, head of Kew Gardens warns
Not to mention trash/waste to biofuel....imagine biofuel processing plants at each major city dump!
Then ethanol would be more than three times the cost of gasoline adjusted for taxes, say between two to three times the cost of gasoline. Who would buy such a fuel? Something doesn't make sense with this statement.
Th ebottom line is that the end goal of environmentalism is to turn back civilization by thousands of years.
When speaking to environmentalists (and there are legions of them here) I like to ask what would be the ideal "green" community. They generally say something like an African village or a native American village.
These people want us living in the stone age.
I agree. The Arab Muslims are taking our money to fund ways to either kill us or convert us to Islam.
I had rather be dealing with the Russians. For all their dishonesty and other faults, at least they aren't suicidal to try to get to a "paradise" that seems to be some sort of holy whorehouse.
Ethanol isn't now being sold at production cost. It is being sold to produce a market.
In the little berg I live in, premium that is 10% ethanol is being sold cheaper than regular unleaded, by one chain. I ask about the practice and was informed it is being sold at the lower price to help in the development of a market.
Our regular unleaded has 10% ethanol, and that content has been so for years. No market issue I can see here (KY.)
I'm not sure it's unfair to evaluate it the way he's doing with prices as they are before the decision is taken, because that IS the alternative if they don't do the coal project.
South Africa took the position that energy self-sufficiency was good for the country, and guaranteed Sasol, the coal gasifier, something like $20/bbl, to insulate them from the immense downside risk in starting up such a process. An approach like that doesn't seem unreasonable here.
The big breakthrough could be the low-cost conversion of plant cellulose to ethanol. Once we master that technology, that could mean that agricultural waste could be converted to ethanol on a huge scale.
This Polish-American scientist at Berkeley has done an excellent job exposing it:
The environmentalists won't be happy till we're all living like a third world country, starving, naked and dying from malaria. Wait... that's already happening in half the world... Not here... right?
The Saudi cost of production is what -- about $5 a barrel? They've been getting $60-70 a barrel recently, which is a pretty nice margin. They have plenty of room to come down. The question is, how much can the Saudis and other OPEC countries increase production?
In the 1970's the oil price spike was clearly artificial. OPEC threw a switch and cut production. The USA then responded with the most completely counterproductive energy policy imaginable, as we subsidized imports and penalized domestic production on the theory that the main enemy was big oil companies, not OPEC. Stupid is as stupid does, but the dems made successful short term politics out of it, which is all they care about. Ronald Reagan solved the problem overnight by decontrolling oil.
The betting on alternative energy sources today rests on one very big assumption -- that the current runup in oil prices is market driven and permanent. I don't pretend to know the answer to that, but most of the analysts seem to agree that OPEC is now producing near capacity and that the Saudis no longer have have the ability to flood the market, especially with India and China coming on strong.
I frankly hope that's right. I can remember filling the tank for $5 or less, and that was nice, but we can clearly live with an oil price of $40-50 a barrel, or even higher. If today's prices stick we will see a very significant shift in the resource base over 20 years. We will still be burning a lot of oil and/or biofuels (unless we make the necessary breakthroughs on hydrogen fuel cells), but the supply will be much more diversified. I hope I live to see it -- let the sheiks go pound sand.
Especially if we restore the public transport. In rural areas people could use more buses, train, bicycles or horses.
Also a theory being pushed by Big Oil.
Why do you think the price of gasoline has dropped this past week? The price of a barrel of oil has not changed.
Big Oil is attempting to slow down any further plans to construct Biorefineries. Plain and Simple.
round and round we go...
The 1970s price spikes were only artificial insofar as US monetary and regulatory policy was ''artificial'', and, as you point out, idiotic. Remember the background then (and I remember it very well, as a trader and broker in that period). LBJ had just, for the first time, REALLY busted the US budget. Bretton Woods had become untenable, and it was only a matter of time until the US went off gold.
Nixon, the moron, put on domestic wage/price controls to ''combat'' inflation in 1971, and cleverly traded -- as ALWAYS w/price controls -- mkt discipline for shortages. The Saudis, after 20 months of this nonsense, with the dollar declining essentially every day, quite reasonably decided that they would build in an anti-inflation premium. The only thing they did that was stupid (and not a little greedy) was to build in 15 years' premium all at once. Inflation btw, for our historians here, was running at all of 5.2% annually when Nixon went berserk. This would come to seem like a bargain in just a few years.
Then, the December 1972 flap w/Israel came along, with the concomitant embargo, and crude doubled in price again. This would be the ''artificial'' run-up of which you spoke; the rest was due solely and only to US policy lunacy. Actually, Ford's and Carter's policies exacerbated the price situation after that point, which is why we got the second oil shock in 1977-1979.
The magic number in crude is and has been for years the daily worldwide excess production capacity in bbl-equivalents, many times called 'excap'. The ''problem'' with alternative production methods is not that they won't work (some of them have worked perfectly well for decades), is not that their cost is indeterminate (it isn't; it's moderately variable w/in a known range), and not that investors won't put up the capital to get these methods online (they're bloody standing in line to plunk their capital down on these deals).
The problem is this: given the feckless and, as we agree, idiotic track record of the US gov't in past regarding energy, both oil companies and investors are scared spitless of two highly likely outcomes. The first (duh!) is government re-regulation along confiscatory lines, of which we saw entirely too much in the 1970s. This, presumably (haha), can be avoided by a combination of heavy lobbying and harnessing an angry citizenry to threaten the political class regarding the only thing that matters to them, to wit, their power. Summary execution of a number of the radical greenie Marxists would be useful here, too. Won't happen, more's the pity.
The second fear cannot be dealt with readily, or perhaps at all. There is the entirely legitimate fear that, even without gov't screwing around with the energy mkts, alternative production (from shale, from tar sands, from biofuel, from liquefaction, from gasification, whatever) will in fairly short order, say a decade, put enough marginal capacity online to raise the excap figure over, say, 4-5 MM bbls/day. This figure is rising slowly even as I write this, about 1.72 MM bbl/day up from 0.6 this past January. If this occurs -- and it will do if all the alternative players crank it up (not to mention the results of expanded drilling and more discoveries worldwide) -- crude will be in the $20s/bbl without a single doubt in this world, no matter the demand increases from Asia.
Companies and investors who hold shares in alternative production ventures that produce at $35 or so/bbl (see the list above) will in this case be royally screwed. There's no way to make back the original, highly capital-intensive investment in 10 years' time.
This unfortunate situation will lead to one of two outcomes. Either the gov't will pick winners (ok, Shell, you go do your in situ recovery from shale in CO, no, sorry, BPAmoco, we don't want your gasification projects -- that sort of thing) or the gov't will cave in to subsidy demands from all of the above producers, would-be and actual. We've seen the latter outcome before, twice in fact. How's your memory today?
Ethanol is an old story in this regard. The same subsidy addicts that infest D.C. now were around in the 1970s, too. Result: a huge ethanol boom...until one day someone ran the numbers. Result: an even more huge ethanol crash. Whole towns in Colorado were shut down (effectively) on 1 day's notice -- ask any Colorado resident of that day, and you'll hear some amazing horror stories.
The second was, of course, Red Jimmuh Peanut's infamous ''synfuels'' boondoogle, which cost multi-billions and never produced a single drop of broad-market fuel. We'll see a some sort of replay of this at some point shortly, very likely (a dead cert if some lefty gets into the White House in 2008).
Whether the current run-up in price is, as you say, ''market-driven (it is) and permanent (it certainly doesn't have to be)'' is up for grabs. It's finger-crossing time, and the past record of events in energy mkts is sufficient for a good deal of pessimism. Gov't will trade sensible policy for perceived short-term political advantage every single time.
Any thoughts here, gents? FReegards!
Exactly. Which is why they want to artifically supress the price of gasoline.
The price of a barrel of oil hasn't changed from last week, yet gasoline prices continue to fall. To what do you attribute this?
Since Big Oil is beginning to invest in biorefineries, it stands to reason they'd like to discourage others from similar investment.