Tuesday, November 15, 2016

Straight Talk on economic issues: No Wisdom without courage

...reluctance to be honest about trade has cost economists their credibility with the public.
 I've seen multiple references to Dani Rodrik's Straight Talk on Trade, which deserves the notice.

Commentary on Brexit often revisited Michael Gove's "people... have had enough of experts." Before getting too nasty with my own thoughts, some of Rodrick's work:
It has long been an unspoken rule of public engagement for economists that they should champion trade and not dwell too much on the fine print. This has produced a curious situation. The standard models of trade with which economists work typically yield sharp distributional effects: income losses by certain groups of producers or worker categories are the flip side of the “gains from trade.” And economists have long known that market failures – including poorly functioning labor markets, credit market imperfections, knowledge or environmental externalities, and monopolies – can interfere with reaping those gains.
They have also known that the economic benefits of trade agreements that reach beyond borders to shape domestic regulations – as with the tightening of patent rules or the harmonization of health and safety requirements – are fundamentally ambiguous.
Nonetheless, economists can be counted on to parrot the wonders of comparative advantage and free trade whenever trade agreements come up... They have endorsed the propaganda portraying today’s trade deals as “free trade agreements,” even though Adam Smith and David Ricardo would turn over in their graves if they read the Trans-Pacific Partnership.
This reluctance to be honest about trade has cost economists their credibility with the public. Worse still, it has fed their opponents’ narrative. Economists’ failure to provide the full picture on trade, with all of the necessary distinctions and caveats, has made it easier to tar trade, often wrongly, with all sorts of ill effects.
This is not the only topic where academia's economists lack the respect for their audience to be candid, or the diligence to develop and defend an opinion of their own.

Thursday, November 10, 2016

President Elect Trump, energy and climate

The elites can only run things with the American people’s permission. Trump is the people’s way of withdrawing their permission. - Salena Zito
I'd been waiting for the American election to be over figuring it limited other serious discussions as it sucked all the oxygen from the blogosphere. Given the outcome, I suspect it will be a low oxygen world for the rest of us for a while yet. Here I'll reference columns from sources I consider relevant on energy, economics and climate change - and then let loose with my own opinions on likely impacts of President Elect Trump for Canada, the Paris agreement, and nuclear energy.

Prospects for the Environment, and Environmentalism, Under President Trump | Andrew C. Revkin | Dot Earth (NY Times)
Is this end times for environmental progress or, more specifically, climate progress?
No.
The bad news about climate change is, in a way, the good news:
The main forces determining emission levels of heat-trapping carbon dioxide will be just as much out of President Trump’s hands as they were out of President Obama’s. The decline in the United States has mainly been due to market forces shifting electricity generation from coal to abundant and cheaper natural gas, along with environmental regulations built around the traditional basket of pollutants that even conservatives agreed were worth restricting. (Efficiency and gas-mileage standards and other factors have helped, too, of course.)
There’s no way around it: Donald Trump is going to be a disaster for the planet | Brad Plumer, Vox
... 
Okay, now for the deep breath.
Even under Trump, there will still be reason for hope. Political change unfolds in unexpected ways, and not everything on Earth revolves around the machinations of the US federal government. So here are a few reasons to think the fight against climate change is not yet lost:

Tuesday, October 11, 2016

Carbon communication cowardice

Some annoyances from the communication on policies I could be supportive of, if not for...

From Ontario's Premier:
Premier Kathleen Wynne is defending the Liberal government’s decision to introduce a cap-and-trade program next year to combat climate change, calling Ontarians “very bad actors” when it comes to creating greenhouse gases.
...
“Even though we’re a small percentage overall of the global greenhouse gas emissions, we’re very bad actors in terms of our per capita creation of emissions,”
Well, if that's true, perhaps we should go conquer lands with more moderate climates.

The latest reporting on emissions for Ontario shows 170,000 kt CO2 eq. in 2014 - exactly 170, 000 kilotonnes of CO2 equivalent emissions.
Statistics Canada shows the population for 2014 as 13,685,171.
Therefore, the per capita emissions were about 12.4 tonnes (thousand kilgrams) per Ontarian.
That's not particularly high for a northern climate, and it's about the OECD average, according to the OECD.


Perhaps if the Premier didn't measure Ontario against 1990, ignoring the province's 32% population growth (1990-2014), and listen to comparisons - in absolute reductions - to stagnant population countries such as Germany, she'd be a little more up on per capita emission trends.
________

Meanwhile, at the often excellent Energy at Haas blog, Meredith Fowlie asks Is Cap and Trade Failing Low Income and Minority Communities?

Monday, October 3, 2016

Ontario suspends procurement of renewable electricity generation

Ontario's suspension of procurement programs for more renewable energy is big news. I'll cite various views on it here, but also editorialize after quoting from the government's press release - with some emphasis added.
Ontario will immediately suspend the second round of its Large Renewable Procurement (LRP II) process and the Energy-from-Waste Standard Offer Program, halting procurement of over 1,000 megawatts (MW) of solar, wind, hydroelectric, bioenergy and energy from waste projects.
This decision is expected to save up to $3.8 billion in electricity system costs relative to Ontario’s 2013 Long-Term Energy Plan (LTEP) forecast. This would save the typical residential electricity consumer an average of approximately $2.45 per month on their electricity bill, relative to previous forecasts. No additional greenhouse gas emissions are being added to the electricity grid.
On September 1, 2016, the Independent Electricity System Operator (IESO) provided the Minister of Energy with the Ontario Planning Outlook, an independent report analyzing a variety of planning scenarios for the future of Ontario’s energy system. The IESO has advised that Ontario will benefit from a robust supply of electricity over the coming decade to meet projected demand.
Before listing mainstream media articles of interest covering the announcement, I'll emphasize this "Cold Air Currents" blog was created to post articles I found interesting - while my "Cold Air" blog was entirely my original work. On this topic, I am an expert, so I'll be both editorialize more than usual, and probably be a little scattered as this announcement touches on many broad themes that deserve (and mostly have) independent articles.
I wrote the last procurement would add $100 million to Ontario ratepayers bills each year, for 20 years - which makes the government's new $3.8 billion savings claim seem reasonable. I was more generous than the government's new press release in attributing minor carbon reductions, with an implied cost of $446/tCO2e.

Following is a summary of press coverage - ordering the sources from most reputable on the topic, to least.

Thursday, September 22, 2016

Agreement signed for Joint Venture to build Advanced Fuel CANDU Reactor

About the AFCR™
The Advanced Fuel CANDU reactor (AFCR™) is a 700MW Class Generation III reactor based on the highly successful CANDU 6® and Enhanced CANDU 6® (EC6®) reactors with a number of adaptations to meet the latest Canadian and international standards. Its fuel flexibility allows it to use recycled uranium or thorium as fuel. It has a heavy-water moderator and heavy-water coolant in a pressure tube design. CANDU reactors can be refuelled on power and have one of the highest lifetime capacity factors among the world’s reactors.
News release from SNC-Lavalin 
MONTREAL, Sept. 22, 2016 /CNW Telbec/ - SNC-Lavalin (TSX: SNC) is pleased to announce it signed an agreement in principle for a new Joint Venture with China National Nuclear Corporation (CNNC) and Shanghai Electric Group Company Ltd. The new company would develop, market and build the Advanced Fuel CANDU Reactor (AFCR™). The creation of the joint venture in principle follows the signing of a framework agreement in 2014, and is subject to all government and regulatory approvals. 
The new company is expected to be registered in mid-2017, and would be followed by the formation of two design centres - one in Canada and another in China - to complete the AFCR™ technology. This could lead to construction of the world's first two AFCR™ in China, and possibly subsequent builds in China and around the world. 
Graphic from Candu: Advanced Fuel CANDU reactor (.pdf)
"This is a game changer in the nuclear industry, and a great endorsement of our expertise and CANDU nuclear technology from the largest nuclear market in the world," said Sandy Taylor, President, Power, SNC-Lavalin. "Each new build in China, and anywhere in the world, will benefit Canada in terms of job creation, innovation and nuclear research & development, environmental stewardship, and will contribute to reduce global carbon emissions." Canada's nuclear sector directly contributes to over $6 billion to the economy annually, employs more than 30,000 highly trained and specialized people, and creates an additional 30,000 jobs indirectly through contracting.

Thursday, September 15, 2016

U.S. politicians act to speed licensing of new generation of nuclear power

You don't often see "unanimously passed a bipartisan bill", but...
US House unanimously passes advanced nuclear development bill
The U.S. House of Representatives unanimously passed a bipartisan bill Sept. 12 to facilitate development of advanced nuclear reactors.
The bill, H.R. 4979, or the Advanced Nuclear Technology Development Act of 2016, would require the NRC to form a framework for reviewing advanced reactor applications. The legislation comes as several older nuclear plants have shuttered or announced plans to close amid market pressures.
"The next generation of the nuclear industry needs to start now, with Congress ensuring that the Nuclear Regulatory Commission is able to provide the certainty that the private sector needs to invest in innovative technologies," said Rep. Bob Latta, R-Ohio, who introduced the bill along with Rep. Jerry McNerney, D-Calif.
The bill would require the NRC to submit a plan to Congress for creating a regulatory framework for advanced reactor licensing, including ways to expedite and streamline the licensing process.
continue reading at SNL 

For a better understanding of the issue, I highly recommend you read Jay Faison's NUCLEAR INNOVATION ISN’T WELCOME HERE:

Sunday, August 21, 2016

Tol: The Structure of the Climate Debate

I can't recommend a paper from Richard Tol highly enough - I think on content, but communication style might be part of the appeal.
Abstract: First-best climate policy is a uniform carbon tax which gradually rises over time. Civil servants have complicated climate policy to expand bureaucracies, politicians to create rents. Environmentalists have exaggerated climate change to gain influence, other activists have joined the climate bandwagon. Opponents to climate policy have attacked the weaknesses in climate research. The climate debate is convoluted and polarized as a result, and climate policy complex. Climate policy should become easier and more rational as the Paris Agreement has shifted climate policy back towards national governments. Changing political priorities, austerity, and a maturing bureaucracy should lead to a more constructive climate debate.
The full paper (.pdf) is worth the full read. Some of my favourite sections (stripped of those clumsy references academics clutter papers with):
Economists have been reluctant, however, to write much about the climate debate itself and apply their tools of analysis to the question why participants in this debate behave the way they do. This paper makes a first attempt.
...
A number of things stand in the way of a reasonable debate on international climate policy

First, the presentation of climate change is often a discourse of fear... There is a demand for an explanation of the world in terms of Sin and a Final Reckoning... Although many Europeans are nominally secular, fewer are in practice. The story of climate change is often a religious one...: emissions (sin) lead to climate change (eternal doom); we must reduce our emissions (atone for our sins). This has led to an environmental movement (a priesthood) that thrives on preaching climate alarmism, often separated from its factual basis. Environmentalism further offers an identity..., a tribe to belong to, and an opportunity to feel better than outsiders. In order to maximize their membership and income, environmental NGOs meet the demand for scaremongering and moral superiority...

Tuesday, August 16, 2016

Bird deaths and ignorance

The big story of the day contains, as it so often does, nonsense from the Canadian Wind Industry - which I'd like to address, so...

Study calls for 18-km turbine setback | John Miner, London Free Press
The U.S. Fish and Wildlife Service has a standard that wind farms not be located within five kilometres of the shoreline. The Nature Conservancy recommends eight kilometres. The new evidence points to an 18-kilometre zone as appropriate, Hutchins said.
“These birds don’t just belong to Canada and the United States, they are a shared resource and they are worth billions of dollars,” Hutchins said, pointing to their role in controlling pests, pollinating crops and dispersing seed. “We can’t afford to lose these animals,” he said.
Ontario doesn’t restrict the proximity of wind turbines in relation to the Great Lakes, but does require wind farm developers to monitor bird and bat deaths for three years. For bats the acceptable mortality level is 10 per wind turbine each year, while the limit for birds is 14 birds annually per turbine.
Beyond those levels, the wind farm company may be required to take mitigating action.
Data released last month indicated wind turbines in Ontario in 2015 killed 14,140 birds, mainly songbirds, and 42,656 bats, including several species on Ontario’s endangered species list.
The U.S. Fish and Wildlife radar study found that migrating birds concentrate along the shorelines to refuel and rest before crossing the lakes. The researchers also found the birds make broad-scale flights along the shorelines to explore wind conditions and orient themselves for migration.

Thursday, August 11, 2016

Renewables and gas and Hinkley Point

I'd been thinking the discussion around the new May government's delay of a decision on EPR reactors at Hinkley Point was featuring well known voices tossing off half-cooked ideas as alternatives to the project, and am now inspired to say so by...

“All other things equal, a 1% percent increase in the share of fast reacting fossil technologies is associated with a 0.88% percent increase in renewable generation capacity in the long term,” the study reports. Again, this is over 26 separate countries, and more than two decades.“Our paper calls attention to the fact that renewables and fast-reacting fossil technologies appear as highly complementary and that they should be jointly installed to meet the goals of cutting emissions and ensuring a stable supply,” the paper adds.
...
“When people assume that we can switch from fossil fuels to renewables they assume we can completely switch out of one path, to another path,” says Verdolini. But, she adds, the study suggests otherwise.
Verdolini emphasized this merely describes the past — not necessarily the future. That’s a critical distinction, because the study also notes that if we reach a time when fast-responding energy storage is prevalent — when, say, large-scale grid batteries store solar or wind-generated energy and can discharge it instantaneously when there’s a need — then the reliance on gas may no longer be so prevalent.
Ah the future - a country unknown to all but zealots.

The study seems to find what I'd expect. Renewables in much of the world (certainly Ontario) lack meaningful capacity value, so they are always additional generation. They do not replace other generators.
Thinking through the eternal promise of storage, I argue wind and solar should be viewed as fuels for the batteries (or other storage) which would be the generators.

It seems to me these issues have been around long enough, they should be obvious, and yet it remains common to see renewables presented as alternatives to actual generators - such as the proposed Hinkley C.

Tuesday, August 2, 2016

New York, South Australia, and U.K. messages on nuclear, and wind

The New York State Department of Public Service (NYSDPS) took a small, but significant step forward yesterday. By a vote of three yeses and one concur, the commissioners decided to implement a clean energy standard that includes zero emission credits for nuclear plants that are struggling in a market where the wholesale prices are too low to cover their fixed costs. - Rod Adams, Atomic Insights
It was nice to see my American pro-nuclear online acquaintances get something of a win yesterday with the passage of a plan I wrote on in New York bringing hope back to US nuclear operator. Now that I can't jinx it passing, I want to discuss issues revealed over the past 3 weeks by events including New York's Zero Emissions Credit (ZEC) initiative, an electricity supply crisis in South Australia, and a new government in the U.K. delaying signing off on a new reactor agreement.

Starting in New York...
Brad Plumer has a story at VOX that seems well regarded, so I'll recommend that while noting the title is highly questionable and the following section both important, and misleading (at best):
From Nuclear power and renewables don’t have to be enemies. New York just showed how:
Right now these reactors aren’t fully compensated for this climate benefit. So, the commission decided, let’s start with that $50 a ton and then subtract out what these reactors already receive from power markets, capacity markets, and RGGI, the Northeast’s cap-and-trade system. Then we’ll pay the reactors for the difference — call it a “zero-emission credit” (ZEC):