Bell Curve The Law Talking Guy Raised by Republicans U.S. West
Well, he's kind of had it in for me ever since I accidentally ran over his dog. Actually, replace "accidentally" with "repeatedly," and replace "dog" with "son."

Wednesday, April 26, 2006

Alternative Fuels, Bush Style

Hi Everyone,

With oil and gas prices setting records people are in a panic casting around for alternatives. In this type of atmosphere it is tempting to think that any alternative fuel plan is a good thing. But they are not equal. And the plans put forward most aggressively by Bush are indicative.

Bush supports ethanol, bio-diesel and hydrogen technology. Why? Because those alternatives preserve the oil companies' control over retail distribution. Ethanol and bio-diesel have the added "advantage" (for Bush) of being massive subsidies for agricultural interests. Americans should reject these approaches out of hand. The mere fact that Bush wants them should make us recoil in horror.

The real solution is electric car technologies; starting with hybrids. Ultimately we will continue to be "over a barrel" regarding energy so long as we allow big Texas energy companies like Exxon et al and Enron style energy brokers to have control over distribution. That means that nuclear power will not solve the political problem - it might solve the emissions problems as long as we can find a place to put the waste and the plants don't blow up. Solar energy, in combination with electric cars, is the solution. Solar energy would allow us to decentralize the power grid and electric cars would decentralize the transportation fuel infrastructure.

Republicans are too beholden to Big Energy. Only Democrats will consider the real solution. Republicans will continue to propose false solutions like ethanol and hydrogen that sound amazing. But the numbers don't add up on those sources and - worst of all - they lock in the power of corporate fat cats.

10 comments:

Anonymous said...

Along those lines, I am not sure I believe the findings of the multiple investigations into price gouging. I am wondering what an investigation consists of. Calling Exxon and asking if they are excessively pricing their product is not an investigation.

I find it odd when I drive down a street with 3 stations, a Texco, Private station (usually with the cheapest price) and a 76 and the 76 is the cheapest gas. And the prices are all 5-10 cents apart. 

// posted by USwest

Anonymous said...

There is certainly price gouging. Gas prices show no lag at all when oil prices go up but show prolonged lags when oil prices drop. That difference is where they get us.

I have no faith in any Republican standing up to Big Energy in any meaningful way - especially not the All Texas Oil Man administration we've got now. 

// posted by Raised By Republicans

Anonymous said...

Maybe the problem here is one of terms. Nobody doubts that market forces are ulitimately responsible for some changes in fuel prices. But "price fixing" means that market forces are being manipulated (for example, restricting supply) while "price gouging" means, I think, taking unfair advantage of temporary market power to dramatically increase prices well above costs, thus earning substantial unfair profits.

I KNOW that price fixing is going on, because market manipulation is well recorded. The authorities won't prosecute it under our somwhat dated antitrust laws (I was involved in a poorly thought out antitrust suits against gas companies a while ago, so it's a private failing to). Also, this pro-business administration won't fix antitrust problems anywhere. The bottom line for consumers is that there are now fewer than six major oil companies who are extremely cozy. They curtail investment, strategically shut down refineries, and otwhersise limit supply to hike prices. Then, as RBR observes, prices shoot up for crises then slowly come down. In real competitive markets, prices go up slowly because competition holds them down (the first one to raise prices loses customers and reputation) then they descend quickly whenever possible through price wars (trying to gain customers and reputation/goodwill).

Outside the US, most oil is in state-owned companies, and OPEC manipulates the market as much as possible. US oil companies are de facto OPEC members, and pursue similar courses (they don't produce more when OPEC produces less, as would happen in a competitive market).

Also, the price of gas is unrelated to actual cost. Oil costs the same to pump now as it did when it was $20/barrel. Thus the massive profits. In my neighborhood, the cheapest gas is now $3.15 for 87 octane unleaded. $3.69 is for supreme at some places.
 

// posted by LTG

Anonymous said...

The favorite solution out here in the Central Time Zone is Ethanol! I wonder if Dr. Strangelove still has the figures for how much of the land area of the US we would have devote to corn crops strictly for fuel if we committed to Ethanol?
 

// posted by Raised By Republicans

Anonymous said...

I'm being a link whore, but nonetheless, Wikipedia speaks: 
Today the US Gas usage is approximately 360,000,000 U.S. gallons per day. 28.8% of the US surface area (~ 685,000,000 acres) would be required to grow the biomass required to produce enough ethanol to cover current domestic US gas demand. The US currently has 455,000,000 acres of arable land. There are currently about 80 million acres of corn planted in the US (~40% of the world's supply).

(For all I know, this was wikified by Strangelove himself.)
 

// posted by Bob

Dr. Strangelove said...

Thanks, Bob, for the Wikipedia information. I cannot claim credit for it, however. I stole my information from someone else... maybe that person Wikified it :-)

Anonymous said...

Gee, in an earlier post last year Dr. S. explained that if we covered Wyoming in solar panels, we'd get all the energy we need. He meant to point out it would be impossible. I was going to offer Alabama to start out. Sounds like a better deal than planting corn. 

// posted by LTG

Anonymous said...

>Sounds like a better deal than planting corn.

Not that ethanol is going to solve all our problems, but where ethanol's currently being produced, we're growing corn _anyway_. Which is a cleverly multipurpose strategy -- it's food, it's fuel, it's pig feed -- whatever's more useful at the time.

The brilliant thing about solar is that it's almost all setup costs: after that, "production" mostly depends on the sun continuing to rise. But that's also one of the biggest problems with solar: setup is expensive (per capacity), and people would much rather pay in installments (say, yearly corn production costs) in the future than give up cash now.

I'm just not convinced that solar isn't subject to economies of scale that'll keep the same big companies in control of energy distribution. If you can point me to information that indicates that throwing some panels up on my roof will cost me less than buying power from some giant array in the Mojave Desert , I'd gladly read up on it. (It'd be nice if it'd provide enough capacity if lots of people did it, too.)

P.S. We're planning on buying a hybrid when we get back to the States and need a car again. Of course, by itself that means burning less oil but more natural gas (or whatever) at the power plant, so we're hardly advancing RbR's cause of sticking it to the energy barons. 

// posted by Bob

Anonymous said...

I'm sure there are economies of scale for solar. And of course solar power would whipe out our current infra-structure for a long long time. But we are now at the point were many new homes and businesses could be built with solar collectors on their roofs that could produce a significant percentage of electricity and during some periods might even produce more than they use. If we could create an infrastructure that would allow people to sell back into a publicly owned power grid, that would introduce an enormous dose of competition into our cartelized energy markets! 

// posted by Raised By Republicans

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