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Energy - Dec 2

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Why energy journalism is so bad

Chris Nelder, SmartPlanet, CNN
One of the questions that plagues me constantly is, “Why is energy journalism so bad?” Most mainstream articles about energy will leave you horribly confused at best, or horribly misled at worst. Today I will try to teach you how to read reports on energy without getting lost.

The topic came up again last week when my colleague Christopher Mims pointed up a sharp discrepancy between three recent stories by Reuters, published between November 21 and 24.

... Let’s review a few of the common errors in energy journalism.
Uncritical acceptance of authority

Citing subject matter authorities is a necessary element of journalism, but so is casting a critical eye on what they say. Unfortunately, most journalists repeat what their selected authorities say verbatim, and rarely mention contrary views.

The main authority cited in nearly all articles about energy is Daniel Yergin, the Pulitzer-winning author of The Prize and an economist with the oil industry consultancy IHS CERA. Journalists love to quote Yergin. He always has an optimistic outlook on the future of oil, forecasting abundant supply and low prices. Editors love him too, and regularly grant him high-profile space in their publications (like this recent Wall Street Journal op-ed) to offer sunny pronouncements and spew invective on those who believe peak oil is a serious issue. The fact that his predictions have been continuously and badly wrong for the last decade straight doesn’t seem to phase them in the least, nor does his cozy (and well-paid) business relationship with oil companies. Hey, he won a Pulitzer, and is regularly described as “one of the world’s foremost energy authorities.” Good enough!

Other authorities often cited are active traders and portfolio managers in the oil market, but it’s a rare day indeed when the authors bother to ask whether those authorities might just be “talking their books.”

... How to read energy journalism

I realize that this all may seem a bit wonky and hard to understand, so I’ll finish with a few words to the wise for the unwary reader.

1. Be skeptical. You will have to make up for the missing skepticism and curiosity of the journalists you’re reading. If the article is all sunshine and roses, and includes no caveats or alternative views, it will be more useful to you as fishwrap than information.

2. Discount the sources. If the cited authority represents the oil and gas industry, you should view their forecasts as propaganda, not truth. Particularly when the authority is from an OPEC producer. OPEC (like the IEA) is a fundamentally political organization, and everything they say in public has a political calculus behind it. For example, I read the unconventional oil optimism expressed by the Saudi official cited at the top of this piece as their way of jawboning down peak oil fears, and throwing analysts off the scent of a trail which leads to serious questions about whether Aramco can increase spare production capacity, and whether the world’s most productive oil field, Ghawar, has indeed gone into decline.

3. Do the math. If the numbers cited don’t add up, then you would be wise to question the validity of what you’re reading. Most of the time it’s simple arithmetic you can do in your head. More ambitious readers will want to bust out a spreadsheet and have a go at the details.

4. Look for context. If the article only talks about resources or reserves, and doesn’t mention production rates, you can safely ignore it. Yes, America may have 1.5 trillion barrels of oil shale (not shale oil, which again is an entirely different thing), but right now we’re producing exactly zero barrels of it, and for good reason: it’s a highly marginal source of hydrocarbons, and too expensive to produce with today’s technology. Remember this: Only flow rates matter, not how much is in the ground.

5. Look up the references. If you really want to know how valid the forecasts are, look up the original sources. Nearly everything is available for free on the Web (except for IHS CERA’s data, naturally), and it’s not hard to find. The crucial caveats are usually stated somewhere in the documents, but you might have to dig for them, and the Find function (Ctrl-F) is your friend when plowing through a 350-page PDF file.

6. Compare to reality. If a claim sounds outlandish, it probably is. Go have look at the data on the EIA’s Web site, and if you’re a beginner, start with their Energy Explained site. See if the forecast looks remotely close to reality. Caveat emptor.

Chris Nelder is a columnist for SmartPlanet.
(30 November 2011)
Great analysis! We've published and linked to Chris Nelder's work frequently.

Kevin Drum at Mother Jones gave this article a favorable write-up: Saudi Arabia Finally Gives Up


The myth of renewable energy

Dawn Stover, Bulletin of the Atomic Scientists
"Clean." "Green." What do those words mean? When President Obama talks about "clean energy," some people think of "clean coal" and low-carbon nuclear power, while others envision shiny solar panels and wind turbines. And when politicians tout "green jobs," they might just as easily be talking about employment at General Motors as at Greenpeace. "Clean" and "green" are wide open to interpretation and misappropriation; that's why they're so often mentioned in quotation marks. Not so for renewable energy, however.

Somehow, people across the entire enviro-political spectrum seem to have reached a tacit, near-unanimous agreement about what renewable means: It's an energy category that includes solar, wind, water, biomass, and geothermal power. As the US Energy Department explains it to kids: "Renewable energy comes from things that won't run out -- wind, water, sunlight, plants, and more. These are things we can reuse over and over again. … Non-renewable energy comes from things that will run out one day -- oil, coal, natural gas, and uranium."

Renewable energy sounds so much more natural and believable than a perpetual-motion machine, but there's one big problem: Unless you're planning to live without electricity and motorized transportation, you need more than just wind, water, sunlight, and plants for energy. You need raw materials, real estate, and other things that will run out one day. You need stuff that has to be mined, drilled, transported, and bulldozed -- not simply harvested or farmed. You need non-renewable resources:

... The only genuinely sustainable energy scenario is one in which energy demands do not continue to escalate indefinitely. As a recent commentary by Jane C. S. Long in Nature pointed out, meeting ambitious targets for reducing greenhouse gases cannot be accomplished with "piecemeal reductions," such as increased use of wind power and biofuels. Long did the math for California and discovered that even if the state replaced or retrofitted every building to very high efficiency standards, ran almost all of its cars on electricity, and doubled its electricity-generation capacity while simultaneously replacing it with emissions-free energy sources, California could only reduce emissions by perhaps 60 percent below 1990 levels -- far less than its 80 percent target. Long says reaching that target "will take new technology." Maybe so, but it will also take a new honesty about the limitations of technology. Notably, Long doesn't mention the biggest obstacle to meeting California's emissions-reduction goal: The state's population is expected to grow from today's 40 million to 60 million by 2050.
(22 November 2011)

Renewable Power Trumps Fossils for First Time as UN Talks Stall

Alex Morales, Bloomberg
Renewable energy is surpassing fossil fuels for the first time in new power-plant investments, shaking off setbacks from the financial crisis and an impasse at the United Nations global warming talks.

Electricity from the wind, sun, waves and biomass attracted $187 billion last year compared with $157 billion for natural gas, oil and coal, according to calculations by Bloomberg New Energy Finance using the most recent data.
(24 November 2011)

Fukushima and the inevitability of accidents

Charles Perrow, Bulletin of the Atomic Scientists
Governments regulate risky industrial systems such as nuclear power plants in hopes of making them less risky, and a variety of formal and informal warning systems can help society avoid catastrophe. Governments, businesses, and citizens respond when disaster occurs. But recent history is rife with major disasters accompanied by failed regulation, ignored warnings, inept disaster response, and commonplace human error. Furthermore, despite the best attempts to forestall them, "normal" accidents will inevitably occur in the complex, tightly coupled systems of modern society, resulting in the kind of unpredictable, cascading disaster seen at the Fukushima Daiichi Nuclear Power Station. Government and business can always do more to prevent serious accidents through regulation, design, training, and mindfulness. Even so, some complex systems with catastrophic potential are just too dangerous to exist, because they cannot be made safe, regardless of human effort.

The March 11, 2011 disaster at the Fukushima Daiichi Nuclear Power Station in Japan replicates the bullet points of most recent industrial disasters. It is outstanding in its magnitude, perhaps surpassing Chernobyl in its effects, but in most other respects, it simply indicates the risks that we run when we allow high concentrations of energy, economic power, and political power to form. Just how commonplace -- prosaic, even -- this disaster was illustrates just how risky the industrial and financial world really is.

Nothing is perfect, no matter how hard people try to make things work, and in the industrial arena there will always be failures of design, components, or procedures. There will always be operator errors and unexpected environmental conditions. Because of the inevitability of these failures, and because there are often economic incentives for business not to try very hard to play it safe, government regulates risky systems in an attempt to make them less so. Formal and informal warning systems constitute another method of dealing with the inherently risky systems of industrial society. And society can always be better prepared to respond when accidents and disasters occur.

But for many reasons, even quality regulation, close attention to warnings, and careful plans for responding to disaster cannot eliminate the possibility of catastrophic industrial accidents. Because that possibility is always there, it is important to ask whether some industrial systems have such huge catastrophic potential that they should not be allowed to exist.
(November/December issue 2011)
Excerpts of the article are online. The full article is behind a paywall. -BA

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