Economics - July 7
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Russia, India Question Dollar Reliance Before Summit
Mark Deen and Simon Kennedy, Bloomberg
Russia and India said the world economy is too reliant on the U.S. dollar and called for changes in how $6.5 trillion in currency reserves are managed, as Group of Eight leaders prepare to meet this week.
“The dollar system or the system based on the dollar and euro have shown that they are flawed,” Russian President Dmitry Medvedev said in an interview with Corriere della Sera, repeating his proposal for a new international reserve currency.
(6 July 2009)
"Free" vs. Peak Oil
Lisa Margonelli, The Atlantic
I haven't read Chris Anderson's new book "Free: The Future of a Radical Price," but I've been following the debate over Malcolm Gladwell's New Yorker review and Anderson's response. Gladwell summarizes Anderson's basic argument as: The digital age is exerting inexorable downward pressure on the prices of all things "made of ideas." This revelation is not unique to Anderson. I mean, hey, it's 6:30 am and I'm blogging for free about articles I read for free for you who will read it for free and meanwhile, my "free" gmail account is trying to sell me a "Didgeridoo for Sleep Apnea."
But underlying this copious pile of free is a steady stream of electrons that keeps our eyes and ears hooked into the ideas beaming out of our computers, TV's, stereos, and twitter-enabled smart phones. Between 2000 and 2005 according to this pdf report by Jonathan Koomey, the amount of electricity used by servers alone doubled to account for 14 power plants world wide and $7.2 billion dollars. Is there some tension between free ideas and limited energy and natural resources? Are free ideas and Peak Oil compatible?
... The low cost of energy has underwritten much of what we accept as reality.
(6 July 2009)
Lisa spoke at the 2008 ASPO-USA conference in Sacramento.
The Elusive Green Economy
Joshua Green, The Atlantic
It feels like 1977 all over again: economy in the doldrums, crisis in the Middle East, and a charismatic new Democrat in the White House preaching the gospel of clean energy. Can Obama succeed where Carter did not? Yes—but only if we’ve learned the lessons of three decades of failure.
Most talk of the climate problem takes place at the abstract level of a Davos panel—all global diagnoses and moral imperatives. The gritty practicalities of addressing it tend to get obscured. But any effort to engineer change on such a grand scale will be an unprecedented feat of business and government, and the spotty results of earlier attempts might give pause were they better known. Given how large our energy policy looms today, what has happened over the 32 years since The Atlantic first raised the issue of clean energy still draws surprisingly little notice.
On one level, this is understandable. Talking about conservation and energy efficiency in the context of the 1970s summons up images of monkish self-denial, a lifestyle of bulky sweaters and humiliatingly small foreign cars that’s a lousy advertisement for the world of tomorrow. It’s important to look back, though: Carter’s efforts failed because of the way the government encouraged clean energy, not because it tried. And the effects of decisions he made could be felt as recently as last fall. The NASA -in-the-’60s analogy would be more apt had the moon landing followed several decades of misfires and crashes.
In the spirit of the original Atlantic article, I traveled to California—now, as then, the heart of the renewable-energy industry—to get a sense of what it will take to bring a green economy into being and meet President Obama’s goal of reducing carbon emissions to 80 percent below their 2005 levels by mid-century.
The best way to get an idea of what a green future might look like is to visit Silicon Valley. It’s impossible to convey how otherworldly the place felt this spring. While the rest of the country suffered beneath the blackening clouds of recession, Silicon Valley buzzed with giddy anticipation that “cleantech,” in local parlance, represents the next great economic boom. In a place that reveres its idols the way ancient Rome did, no less than the famed venture capitalist John Doerr has pronounced cleantech “the biggest economic opportunity of the 21st century.” Today, Silicon Valley is the anti-Detroit.
The organizing principle behind clean technology is that the growing scarcity and higher cost of fossil fuels, coupled with environmental concerns, will drive society toward alternative sources of energy, with enormous wealth accruing to whoever can supply them. For the past century, U.S. energy policy aimed to promote cheap and abundant electricity, and the nation achieved this mainly by burning coal. More demand led to more power plants, built with little heed to pollution or performance. This gave rise to a modern power industry that not only emits enormous amounts of greenhouse gases but does so with remarkable inefficiency. (A typical coal-fired plant burns three lumps of coal to produce one lump’s worth of electricity; the rest goes up the chimney as waste heat.) Because coal, oil, and natural gas generate most of our electricity and won’t disappear soon, cleantech is generally understood to consist of a “supply” side and a “demand” side. While one half of Silicon Valley is busy developing clean supplies of energy, the other half is working out ways to reduce demand for the dirty kind.
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