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United States - June 9

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Lagging Recognition

James Howard Kunstler, Clusterfuck Nation
Through the tangle of green shoots and sprouting mustard seeds, a certain nervous view persists that the arc of events is taking us to places unimaginable. The collapse of General Motors and Chrysler signifies more than the collapse of US car manufacturing. It spells the end of the motoring era in America per se and the puerile fantasy of personal liberation that allowed it to become such a curse to us.

Of course, many Nobel prize-winning economists would argue that it has only been a blessing for us, but that only shows how the newspapers are committing suicide-by-irrelevance. And if other societies, such as China's late-entry industrial start-up, want to adopt a similar fantasy, they will only find themselves all the sooner in history's garage with a tailpipe in their mouths.

Here in the USA, we will mount the most strenuous campaign to keep the motoring system going -- in fact, we're already doing it -- but it will fail just as surely as two (so far) of the "big three" automakers have failed. It will fail because car-making is only one facet of a larger network of systems that is coming undone, namely a revolving debt cheap energy economy.

Americans will never again buy as many new cars as they were able to do before 2008 on the terms that were normal until then: installment loans. Our credit system is completely broken. It choked to death on securitized debt engineered by computer magic and business school hubris. That complex of frauds and swindles coincided with the background force of peak oil, which meant, among other things, that economic growth based on ever-increasing energy resources was over, and along with it ever-increasing credit. What it boils down to now is that we can't service our debt at any level, personal, corporate, or government -- and that translates into comprehensive societal bankruptcy.

The efforts of our federal government to work around this now, to cover up the "non-performing" debt and to generate the new lending necessary to keep the old system going, is a tragic exercise in futility. I'm not saying this to be a "pessimistic" grandstanding doomer pain-in-the-ass, but because I would like to see my country make more intelligent choices that would permit us to continue being civilized, to move into the next phase of our history without a horrible self-destructive convulsion.
(8 June 2009)



Industry Defends Drilling, Ignores Water Contamination

Abrahm Lustgarten, ProPublica
Industry Defends Federal Loophole for Drilling Before Packed Congressional Hearing
---
In a packed and sometimes contentious hearing [1] on Capitol Hill Thursday, representatives of the oil and gas industry and their state regulators vigorously defended the practice of injecting toxic fluids underground without federal regulatory oversight [2].

The House Energy and Minerals subcommittee called the hearing to explore the economic and environmental risks associated with the practice, called hydraulic fracturing [3], after a string of reports of water contamination related to drilling across the country were reported by ProPublica [2]. Hydraulic fracturing is currently exempted from the Safe Drinking Water Act, but both the House and Senate are drawing up legislation that would close the Bush-era loophole and reinstate the Environmental Protection Agency's authority over the fracturing process.

The House version of the bill [4], which would also require drilling companies to disclose the names and amounts of the chemicals they inject underground, is expected to be introduced Tuesday.

In the hearing, industry-affiliated groups and an executive of Chesapeake Energy told the committee [5] (PDF) that state regulations of hydraulic fracturing are sufficient and effective and insisted that the fracturing process and the chemicals it uses are safe. They said regulating the process under the Safe Drinking Water Act would add a needless layer of regulation that would cost billions of dollars and thousands of jobs.

But a close reading of the law shows that the Safe Drinking Water Act already defers regulatory authority over oil and gas drilling to the states and that reversing the exemption in question would mainly provide a baseline for best practices and give the federal government authority to investigate contamination cases or disastrous accidents.

"I frankly think the oil and gas companies have been running a scare campaign," Colo. Representative Diana DeGette, a co-sponsor of the bill along with Maurice Hinchey (D-NY) and Jared Polis (D-Co) , said after the hearing. "I don't know if the oil and gas industry doesn't understand the bill or if they are intentionally misrepresenting the bill."

Much of the debate centered on issues unearthed in a series of articles by ProPublica [6], which has been investigating natural gas drilling for the past year.
(5 June 2009)



Upping the Ante

Carl Etnier, Barre Montpelier (Vermont) Times Argus
Now even the International Energy Agency is worried about medium-term energy supply. The IEA, created by the wealthy countries in the Organization for Economic Cooperation and Development in the wake of the 1973-74 oil price increases, has for years projected uninterrupted growth in oil consumption, without clearly explaining where the new oil would come from in an increasingly tapped-out world. Last month, ahead of the G8 energy ministers' summit in Italy, the IEA had a different message: investment in energy production of all types is too low, and we face shortages when the economy rebounds.

The Vermont Energy Act of 2009 begins to heed this message, by spurring more investment in renewable energy and efficiency.

... Vermont upped its investment in efficiency and clean energy this year with the new energy bill passed by the Legislature. Gov. James Douglas didn't like the bill, but apparently it was too popular for him to risk a veto override; he let it become law without his signature.

One part of the Vermont Energy Act of 2009 directs that federal stimulus funding for the state energy program will go to the Clean Energy Investment Fund, and that all monies received by the fund will be used to invest in renewable energy and efficiency, rather than lowering electrical rates in the short term. The Act widens the focus of the Fund to include heating projects, not just electrical efficiency.

Another section of the Act makes Vermont the first state in the nation to guarantee long-term, profitable contracts to developers of small-scale renewable electricity generation, such as wind, hydro, and solar. One third of the electricity on the New England grid is generated with natural gas. If the IEA is right that decreasing investments in gas production will lead to medium-term price spikes, it's an opportune time to invest in renewable electricity sources, whose fuel is free.

The Act also ensures that Vermont's residential and commercial codes are up to date with the latest national standards. Though building designers tell me that a lot of cost-effective efficiency measures are not in the standards, keeping Vermont's codes up to date at least raises the floor on building energy efficiency.

Another national first in the Act is statewide authorization for cities and towns to create "clean energy assessment districts." The districts can borrow money, at the low interest rates and long payback terms available to municipalities, to lend to property owners who want to use renewable energy or increase their building's efficiency.

... The Vermont Energy Act of 2009 starts to make some of those investments. They will plug some of the leaks of money out of the state; in 2008, for heating alone, Vermonters spent $1.4 billion, most of which left the state. I think many people will be surprised at how cost-effective these investments are.

Carl Etnier, director of Peak Oil Awareness, blogs at vtcommons.org/blog and hosts radio shows on WGDR, 91.1 FM Plainfield and WDEV 96.1 FM/550 AM, Waterbury. He can be reached at EnergyMatters
(7 June 2009)

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