Quotulatiousness

October 20, 2018

Barley, beer, and climate change

Filed under: Economics, Environment — Tags: , , , — Nicholas @ 05:00

There was a “study” recently released proclaiming the end of beer … or at least a huge hike in beer prices coupled with a drop in availability due to climate change. Tim Worstall explains why the report is — at best — misleading:

Barley (Hordeum vulgare) at the United States National Arboretum.
Photo by Flikr user “Cliff” via Wikimedia Commons.

You’ll have seen the various reports over the past few days that climate change is going to do terrible damage to the beer industry. The mechanism is that drought and heat will reduce the barley yield, this will then reduce the amount of beer that can be made. What follows is the explanation from the actual researchers of what they’ve done. It is, to put it mildly, nonsense. For their assumptions are wrong. Let us say that climate change does reduce barley yields on those lands currently planted to it. But we do know that as this happens then other, more polar, regions open up to being suitable for the growing of barley. So the initial worry is just untrue.

They then go on to insist that we’ll feed the cows on the barley that’s left rather than make beer from it. Thus the shortfall in beer is greater than that in barley. Nonsense upon stilts. Humans don’t work that way. We started this agriculture thing because we wanted the beer after all. Feeding the animals came later – and often enough the cows are fed on the barley after we’ve made the beer from it anyway. We’d put our minimal supply into booze not beasts.

Finally, they tells us that Irish beer prices would double. No, really, given the level of taxes there upon the stuff it’s really not true that even their 30% reduction in barley supply is going to double the price.

October 13, 2018

It’s always TEOTWAWKI, and the demands are always the same

Filed under: Economics, Environment, Media, Technology — Tags: , , , , — Nicholas @ 03:00

Sean Gabb on the message and tactics of the alarmists — whose chosen fixation shifts over time, but whose demands are always the same:

Once you cut through their verbiage, the enemies of bourgeois civilisation have two demands. These are:

  1. Put me and my friends in charge of preferably a one-world government with total power over life and property; or, until then, or failing that,
  2. Give us a lot of money.

When I was younger, the occasion for making these demands was something to do with poverty or economic instability, and the alleged need was for a bigger welfare state, or state ownership of the means of production, or playing about with money to “move the aggregate demand curve to the right.” The nice thing about these claims and their alleged solutions was that they all had to be debated within the subject area of Economics. Because most of us knew a lot about Economics, we could always win the debates.

By the end of the 1980s, winning was so easy, the debates had become boring. Since then, the alleged need has shifted to saving the planet from some environmental catastrophe. The resulting debates are now harder to win because most of us are not that learned in the relevant sciences. Though I am more than competent in Economics, my main expertise is in Ancient History and the Classical Languages. Much the same is true for most of my friends.

Take, for example, the latest occasion for making the two demands stated above. This is that the sea is filling up with waste plastic, and that this looks horrid, and is being eaten by the creatures who live in the sea, and that they are all at risk of dying – and that this will be a terrible thing of all of us. For the solution, see Annie Leonard, writing in The Guardian: “Recycling alone will never stem the flow of plastics into our ocean. We must address the problem at the source.” You can take her last sentence as shorthand for the usual demands.

What response have I to this? Not much directly. Give me half an hour, and I will explain with practised ease that the Phillips Curve is at best a loose correlation between past variables, and that there is no stable trade-off between unemployment and inflation. But search me how most plastics are made, how long they take to degrade, or what harm they do if eaten.

A short search on the Web has brought up some useful information. There is, for example, an essay by Kip Hansen, published in 2015 – “An Ocean of Plastic.” He says, among much else:

  • That the Great Garbage Patch said to be floating about the Pacific is a myth, and that the main alleged photographs of it were taken in Manila Bay after a storm had washed the rubbish out of the streets;
  • That the amount of plastic waste floating in the sea is very small per cubic metre of water, and that it is invisible to the uninformed eye in the places where this Garbage Patch is said to be floating;
  • That plastic waste quickly breaks down into tiny chunks that are then eaten by bacteria, who are not harmed by it;
  • That larger chunks eaten by fish and birds are easily handled by digestive systems that have evolved over many ages to cope with much worse than the occasional lump of polystyrene foam.

His conclusion:

    The “floating rafts of plastic garbage”-version of the Great Pacific Garbage Patch is a pernicious myth that needs to be dispelled at every opportunity.

October 12, 2018

Carbon taxes may be efficient, but let’s not rush into it quite yet…

Filed under: Cancon, Economics, Environment, Government — Tags: , , , , — Nicholas @ 05:00

Terence Corcoran says we shouldn’t jump at the chance to kill our economy just because carbon taxes are efficient:

It didn’t take long for federal Environment Minister Catherine McKenna to tweet out the news implying that the Nobel committee supported the government of Canada’s carbon-price scheme. The Montreal-based carbon-taxing NGO, the Ecofiscal Commission, hailed Nordhaus for having “demonstrated” that a universal price on carbon was the most “efficient” way to curb climate change.

Before jumping aboard the Nordhaus bandwagon, however, carbon-taxing politicians and all Canadians might want to take a closer look at what they are being led into.

[…]

Nordhaus and his co-winner of this year’s Nobel in economics, former Stanford economist Paul Romer, are great believers in “incentives.” As Romer said in a post-Nobel interview (tweeted by McKenna, naturally): “I believe, and I think Bill (Nordhaus) believes, that if we start encouraging people to find ways to produce lower carbon energy, everybody’s going to be surprised at the progress we’ll make as we go down that path. All we need to do is create some incentives that get people going in that direction, and that we don’t know exactly what solution will come out of it — but we’ll make big progress.”

But why a tax? If all we need to do is deploy the price mechanism, why impose a tax? Let’s ignore for a moment the dubious assumption that the science and economics of climate change are sound and settled. Would it still not be better to have the government set the carbon price, require the energy companies to charge it, but allow the revenue to flow not to government but through to energy companies and their shareholders, and others in the supply chain? That’s where market forces and the above-mentioned miracle price mechanisms — rather than government planners — would determine where to invest and what energy alternatives are best. (No gas retailer could possibly eat the cost of a 90-cent-per-litre carbon tax, so they’d have no choice but to pass at least most of it along to the customer).

One of the ironies of carbon taxation is the enthusiasm for “market mechanisms” and “prices” among politicians who otherwise abhor and resist market pricing of everything from roads to health care to rental housing to public transit to education to broadcasting and telecom and the internet and the price of cannabis, not to mention the Canadian price of milk and chickens. With carbon, market pricing is suddenly a great idea, no matter how fanciful the analyses and speculative the projections.

September 6, 2018

Trans-partisan planning

Filed under: Economics, Environment, Politics, USA — Tags: , , , , , — Nicholas @ 03:00

At Coyote Blog, Warren Meyer offers a plan to address man-made climate change, pitched to avoid being dismissed as “typical” of one or the other side:

While I am not deeply worried about man-made climate change, I am appalled at all the absolutely stupid, counter-productive things the government has implemented in the name of climate change, all of which have costly distorting effects on the economy while doing extremely little to affect man-made greenhouse gas production. For example:

  • Corn ethanol mandates and subsidies, which study after study have shown to have zero net effect on CO2 emissions, and which likely still exist only because the first Presidential primary is in Iowa. Even Koch Industries, who is one of the largest beneficiaries of this corporate welfare, has called for their abolition
  • Electric car subsidies, 90% of which go to the wealthy to help subsidize their virtue signalling, and which require more fossil fuels to power than an unsubsidized Prius or even than a SUV.
  • Wind subsidies, which are promoting the stupidist form for power ever, whose unpredictabilty means fossil fuel plants still have to be kept running on hot backup and whose blades are the single largest threat to endangered bird species.
  • Bad government technology bets like the massive public subsidies of failed Solyndra

Even when government programs do likely have an impact of CO2, they are seldom managed intelligently. For example, the government subsidizes solar panel installations, presumably to reduce their cost to consumers, but then imposes duties on imported panels to raise their price (indicating that the program has become more of a crony subsidy for US solar panel makers, which is typical of these types of government interventions). Obama’s coal power plan, also known as his war on coal, will certainly reduce some CO2 from electricity generation but at a very high cost to consumers and industries. Steps like this are taken without any idea of whether this is the lowest cost approach to reducing CO2 production — likely it is not given the arbitrary aspects of the program.

These policy mess is also an opportunity — it affords us the ability to substantially reduce CO2 production at almost no cost.

September 5, 2018

Mind Your Business Ep. 1: Breaking the Mold

Filed under: Business, Environment, Food, Health — Tags: , , — Nicholas @ 04:00

Foundation for Economic Education
Published on 4 Sep 2018

Join host Andrew Heaton as we profile the stories of interesting entrepreneurs from around the country for FEE’s newest series, Mind Your Business.

In this episode, we’ll meet Jeremy Umansky. He’s a chef with a true passion for unusual food and his unique brand of cuisine is making a big splash in the culinary world.

September 1, 2018

The legal tangle around the Trans-Mountain pipeline approval process

Filed under: Business, Cancon, Environment, Government, Law — Tags: , — Nicholas @ 03:00

Jay Currie suspects the process has been intentionally complicated to the point that there may not be a way out for this government:

What the Court essentially asked was, “Did the Federal Government consult enough?” and then concluded, “No, not enough.”

How much is “enough”? That is a question which this decision really does not answer. And I suspect it does not answer it because there is actually no answer which is even close to true.

In a normal process a reasonable level of public consultation would be reached when the public has been given an opportunity to comment on the matter at hand. Which is a bit vague but there is case law which fleshes out what such an opportunity might look like.

However, once environmentalists and First Nations are engaged it is not at all obvious that merely having the opportunity to comment is sufficient. Unlike a rezoning application, an application to build a pipeline (or, realistically, virtually any other large undertaking) creates the opportunity for First Nations to talk about everything from ancient hunting rights, to sacred grounds, to former village sites, to disruptions to present First Nation culture and so on. Having the environmentalists involved ensures that the relatively easy solution of simply paying the First Nations’ people for their consent, is off the table. That solution will be denounced by the enviros as cultural genocide and worse.

All of which creates, and might arguably have been intended to create, a Gordian knot when it comes to considering major projects. Consultation becomes an endless task and one which has no defined parameters. The decision today indicates that an extensive consultation process is not enough but it does not indicate what might be enough.

Delightfully, the shareholders of Kinder Morgan – which owns TransMountain – voted today to sell the project to Canada’s feckless Federal Government for several billion dollars.

I suspect the CEO danced a little jig relieved that he no longer had to guess at how far consultations have to go. But Canada is stuck with a completely dysfunctional system which is being exploited by environmentalists and First Nations to prevent infrastructure from being built. That will have to be fixed.

August 31, 2018

Experimental strip farm demonstrates why strip farming was eventually abandoned

Filed under: Britain, Environment, History — Tags: , , — Nicholas @ 05:00

Tim Worstall uses an article in the Guardian about a National Trust experimental replication of medieval farming patterns to point out exactly why modern farms do not use them:

Plan of a fictional medieval manor. The mustard-coloured areas are part of the demesne (owned by the lord), the hatched areas part of the glebe (reserved to support the parish priest).
Illustration from William R. Shepherd’s Historical Atlas, 1923 via Wikimedia Commons.

The proof of the inefficiency is in the presence of that lots more wildlife. We’re trying to grow food for humans to eat recall. So, more wildlife eating off the same earth is less food for humans. We have more butterflies around? That’s nice, but that does mean more caterpillars munching on those now not for humans crops. Hen harriers? Great, but they’re eating the mice and the voles living off those crops. Land that’s growing wildflowers isn’t growing grain or veggies for us, is it?

Sure, it’s nice to have hen harriers, great to have wildflowers. But their very existence on this land shows that this method of farming is less efficient at doing the job of farming – growing food for us. Which is why we abandoned this method of farming of course. Under the simple and basic pressures of trying to gain more output from our inputs. And yes, land is, obviously enough, an input into farming.

And if we’d like to have flowers and harriers? Then we should be using the most efficient farming methods on those areas we do farm so as to leave more space, more land, for the pretty things we’d also like to have. That is, prairies of glycophosphate drenched wheat for us, the other 30 or 50 or 70% of the land left alone for them. And the more chemicals we use on our bit the smaller that bit devoted to us is going to be.

The very fact that we’ve more wildlife as a result of this inefficient farming method shows us that we must be using the more efficient industrial methods. You know, to save the wildlife?

August 30, 2018

“This is simply drivel. And it’s the standard Green Party phantasm written out again”

Filed under: Bureaucracy, Economics, Environment, Government — Tags: , , , , — Nicholas @ 05:00

Tim Worstall is not impressed with a new study out of Finland which recommends that the United Nations become much more involved in organizing and directing the lives of everyone on the planet … for our own good, of course:

We’ve another of those pieces of environmental drivel on offer to us. Here it’s the considered opinions of some Finnish knownothings on what is necessary to achieve the UN’s Sustainable Development Goals. The basis of which is that we should all prepare to be rather poorer. No, not because the Earth is running out of stuff to make us richer but because our Finnish knownothings are recommending that the UN take charge of things and forcibly make us poorer.

This is perhaps not the correct manner of running the global economy.

[…]

That’s all entirely drivel, of course. Capitalism doesn’t depend upon cheap fossil fuels nor even cheap energy. It’s just an economic system in which we have private property. Including the value added belonging to the people who own the property which adds the value. That’s really all it is too. Profit belongs to the people providing the capital – this is definitional by the way. For that’s what we define profit as, that part of the returns from an activity which go to those who provide the capital.

There is absolutely nothing at all which requires that energy, or any natural resource, be of any particular price nor level of price. All we are saying when we recommend capitalism is that the system seems to work better when those who make a profit get to keep it. Our economic definition of profit being when value of output is greater than the costs of inputs. Who gets those profits is definitional about capitalism. Any and every economic system is trying to produce profits. Because any and every economic system is trying to add value to inputs, trying to create value.

[…]

There’s a remarkable lack of reasoning as to why international trade needs to be limited or regulated. If we’re facing more expensive energy then we should be doing more of it, not less. But then perhaps those doing bio- and physics don’t know that Adam Smith pointed out we’d do better getting the wine from Bourdeaux rather than growing the grapes in Scotland. Or even that David Ricardo launched an entire subset of economics with his observation that trade uses fewer resources than non-trade. I mean, it is possible that they’re just ignorant of the most basic points here, isn’t it?

They’ve also not grasped that good life and economic growth part at all. No one actually producing economic growth – defined, as always, as an increase in the value being produced – does so in order to produce economic growth. They do it in pursuit of their definition of the good life. Economic growth is simply the aggregate of all those people trying to make their own lives better, their pursuit of that good life. The inverse is also true. If we leave people alone to pursue their own versions of the good life then economic growth is what we get. Our bio-p types seem unaware of the laissez faire argument. That we all get richer faster if left alone to our own visions of life?

Now, if this was just a few blokes in the Far North muttering to themselves among the trees of future toilet roll this wouldn’t matter. But this is serious advice to the United Nations? It’s about to become art of how world governance works? Dear God Above, what have any of us one to deserve this?

Try this for example:

    A key problem with carbon pricing has been that states, federations, or unions have not implemented it on a sufficiently high level, fearing industrial leakage to less environmentally-regulated countries. For this reason, many economists and politicians hope for global carbon pricing. But if we return to the four examples above, energy, transport, food, and housing, we can see that it would be highly unlikely that even global carbon pricing would guide economic activity in the right direction – at least with sufficient speed and breadth. As a policy tool, carbon pricing lacks the crucial element of coordinating a diverse set of economic actors toward a common goal. Individual actors would have an incentive to decrease carbon emissions, but they would still compete through their own business logics; there would be nothing to ensure that any one business logic would support the transition to sustainability on a systemic level.

Everyone on the planet economises on their carbon emissions because emissions are now more expensive. This does not work to coordinate everyones’ actions about carbon emissions? These people never have considered the role of the price system in coordinating human activities, have they? Not heard a single beanie about Hayek, the Pretence of Knowledge and all that?

August 28, 2018

The darker side of those cute, playful dolphins

Filed under: Environment, Randomness — Tags: , — Nicholas @ 05:00

David Warren considers the parallels between certain dolphin behaviour and its human equivalent:

Spinner dolphins
Photo by Philippe Bourjon via Wikimedia Commons.

I am, let me confess, no expert on dolphins, nor on any other member of the cetacean paraphyly. Nor, for that matter, on anything at all, in my current recollection. I do however know that dolphins can swim very fast, can leap high out of the water, can be as long as thirty feet, and that even small dolphins, no longer than a man, are very strong. I would not mess with one in the water. Before assuming that their behaviour, in the state of nature, is entirely benign, one should ask some fish. Even a porpoise could tell you: they have their dark side. Especially a porpoise: for dolphins have been known to murder hundreds of them, for no stated reason. They can take a dislike to each other, too; and for reasons that we may darkly surmise, act upon what we take for their emotions.

Example: when they throw each other’s children in the air, they are not being playful.

On at least one occasion I have had to explain to an environmentalist that the sob-story he was telling, about dolphins found dead or dying on a Virginia beach, had nought to do with capitalist perfidy. On forensic examination, all the beached dolphins were found to have suffered severe blunt-force trauma — administered by other dolphins.

They have also been known to dislike humans, for instance pulling them under the water until they stop making bubbles. Brooding, “loner” dolphins are particularly noted for the sort of behaviour that we might be inclined to characterize as evil.

Smiley-face, bottlenose dolphins, of the Tursiops genus, are among those sexually dimorphic, which is to say, the males are decidedly bigger than the females. They are very smart, in both sexes, but not nearly as sentimental as our New Age propagandists have advertised. I cannot imagine a feminist being pleased with their courting rituals, which closely resemble entrapment and rape. I take an unsentimental view of the dolphins myself, though I am prepared to admire their skills. I cannot believe male dolphins are gentlemen.

A story forwarded to me this morning from the London Telegraph tells a commonplace tale. A bottlenose dolphin has been terrorizing swimmers off a beach in Brittany. A loner male, with a marked preference for human females, has alas “progressed” from being a source of entertainment. The theory is that he is sexually frustrated. This strikes me as possible, but possibly narrow. I have read several stories before — from different continents — in which just such a loner male dolphin graduates from public entertainer, to public nuisance, to public danger, around a specific beach. In every case it seems the dolphin is believed to be sexually “aroused.” I would not be surprised to learn that the same symptoms accompany psychopathic behaviour in dolphins, as they often (if not always) do in rogue loner humans.

August 10, 2018

The tough part of selling a national carbon tax … is the “tax” part

Filed under: Cancon, Economics, Environment — Tags: , , — Nicholas @ 05:00

As Colby Cosh points out, you can find all sorts of economists to explain why a properly constructed and applied carbon tax is the least harmful way to reduce carbon output, but Canadians typically focus on the “tax” part and not the claimed environmental efficiency benefits:

In yesterday’s Financial Post, the Calgary economist Jack Mintz asked the question “Why are carbon taxes so unpopular?”, pointing out that plenty of countries and jurisdictions have commitments to climate progress and energy efficiency but that few use this particular policy instrument. I guess Jack wouldn’t have had much of a column if he had just adopted the spirit of an auto mechanic explaining a breakdown to a naive car owner and jabbed directly at the problem. “See that word ‘taxes’? There’s your problem right there.”

And, truly, it is not quite as simple as that. But, as Mintz suggests, it is a big part of the difficulty. As a means of helping reduce carbon output, carbon taxes are competing with subsidies and regulations. Pervasive carbon taxes are, as a general principle, a less costly way of eliminating freely exhaled carbon, pound for pound or ton for ton.

If the tax is well designed, you are slapping a uniform unit price directly onto the thing you are trying to prevent; and you are leaving people and businesses to make decentralized judgments, based on their knowledge of their own circumstances, about whether to avoid the tax, and when, and how to do it. Even though the initial level of the tax must be something of a guess, you can adjust it by arbitrarily small increments until you have eliminated just as much carbon output as you wish to.

Economists will recognize that last paragraph as a grocery list of the relative advantages of carbon taxation. But voters are predisposed to hate taxes, and are very sensitive to their size and their side effects. They may not like government subsidies for windmills or carbon-capture schemes or certain species of light bulb either; but subsidies can usually be sold on the basis of local job creation or business incubation, and they can be — let’s face it, inevitably are — adjusted for maximum electoral benefit.

For my part, I don’t disbelieve the economists on the efficiency arguments … I just don’t trust the government to design and implement such a tax without rigging the system to benefit favoured corporations, regions, and donors.

August 7, 2018

Grasping at straws to virtue signal

Filed under: Economics, Environment, Government, USA — Tags: , , , — Nicholas @ 03:00

Richard Morrison points out just how banning plastic straws will not do anything meaningful to save the environment, but will definitely have a negative impact on consumers:

Of all the consumer products one might have expected to become a flashpoint for political controversy, the humble plastic drinking straw is an unlikely contender. Leap into the headlines it has, though, with communities like Seattle and San Francisco recently enacting bans on disposable straws. The city council of Santa Barbara, California, initially voted for a ban that would have punished restaurant workers with up to six months of jail time for giving out a disposable plastic straw, but city officials agreed to revisit the ordinance when it appeared to also ban the sale of straws at supermarkets.

[…] the case against the plastic straw is exceedingly weak. There aren’t as many plastic straws thrown away as claimed, and only a tiny portion of U.S. straws end up anywhere near the oceans — the vast majority of municipal solid waste in this country ends up either buried in landfills, recycled, or burned up in incinerators, far from any congested sea turtles.

The vast majority of plastic waste in oceans actually comes not from advanced countries like the U.S. but from countries like China and Indonesia that consume a large volume of plastic products but lack our modern waste collection infrastructure. Much of their plastic waste ends up washed into major river systems that empty into the oceans. A study published last year in the journal Environment Science & Technology by three German researchers found that 90 percent of the plastic debris found in the world’s oceans is dumped there by just ten of the world’s rivers — none of which are in the Western Hemisphere, much less the United States.

Beside the fact that U.S. consumers are contributing very little to the ostensible problem is the other side of the equation: the benefits of the straws themselves. I suspect many Americans who were initially receptive to the idea of a ban were genuinely surprised to learn that disposable drinking straws are very important to people with certain disabilities. British disability rights activist Penny Pepper recently commented in the Guardian about how she depends on plastic straws — and other single-use, disposable products like baby wipes — writing “I don’t have the luxury of a plastic-free life.” The durability, convenience, cleanliness, low price, and resistance to heat of disposable plastic straws make them irreplaceable to people with many different physical limitations.

Vancouver, as any Canadian would have guessed, was the first Canadian city to pick up on this particular variant of virtue signalling.

July 11, 2018

Environmentalists against science

Filed under: Environment, Government, Science, Technology — Tags: , , , , , — Nicholas @ 03:00

At Catallaxy Files, Jeff Stier looks at situations when activists who normally fetishize their devotion to science will go out of their way to fight against scientific findings that don’t co-incide with their preferences:

The debate over regulation often devolves into a debate about “too little” versus “too much” regulation, split along the ideological divide. Too little regulation, goes the argument, and we are exposed to too much risk. Too little, and we don’t advance.

This binary approach, however, represents the dark-ages of regulatory policy. It was more frequently relevant when our tools to measure risk were primitive, but today’s technology allows much more precise ways to evaluate real-world risks. With less uncertainty, there’s less of a need to cast a broad regulatory net.

Regulation not warranted by countervailing risk just doesn’t make sense. That’s why a pseudoscientific approach, dubbed the “precautionary principle,” behind much of today’s regulation is so pernicious. This dogma dictates that it’s always better to be safe than to ever be sorry. The approach is politically effective not only because it’s something your mother says, but because it’s easier to envision potential dangers, remote as they may be, than potential benefits. Uncertainty, it turns out, is a powerful tool for those who seek to live in a world without risk.

But what happens when regulators can get a reasonably good handle on benefits and risks? Some potential risks have been eliminated simply because the basis for the concern has proven to be unwarranted. For more than two decades, the artificial sweetener, saccharin, came with a cancer warning label in the U.S.But it turned out that the animal experiment which led to the warning was later found to be irrelevant to humans, and the warning was eventually removed.

Warning about a product when risks are not well-understood is prudent. But it would be absurd to continue to warn after the science tells us there’s nothing to worry about.

Today, an analogous situation is playing out in the EU, where activists are using outmoded tests not just to place warning labels on silicones, a building block of our technological world, but to ban them outright.

The playbook is predictable: as the scientific basis for a product’s safety grows, opponents go to increasingly great lengths to manufacture uncertainty, move the goalposts and capitalize on scientific illiteracy to gain the political upper-hand.

We’ve seen these tactics employed in opposition to everything from growing human tissue in a lab, to harm-reducing alternatives to smoking, such as e-cigarettes. Now, the effort to manufacture uncertainty is playing out in the debate over the environmental impact of silicones, which are used to in a wide range of consumer, medical, and industrial products.

Fortunately, in the case of silicones, regulators in a number of countries, including Australia, have put politics aside and adhere to appropriate scientific methods to inform their decision-making.

July 7, 2018

The bad economics of rooftop solar installations

Filed under: Business, Economics, Environment, Government — Tags: , , , — Nicholas @ 03:00

Norman Rogers points out where the numbers don’t add up for many jurisdictions’ domestic solar power schemes:

Photovoltaic panels on a roof, 28 April, 2015.
Photo by Antonio Chaves, via Wikimedia Commons.

A modest proposal:

We’ve all heard about “shop local” and “get your food from local farmers, not distant corporate farms.” Lots of people have apple trees in their backyards. Often they can’t begin to eat or give away all the apples. In the meantime, big supermarkets sell corporate apples for one dollar a pound and up. I propose that people with backyard apples be able to take them to the supermarket and sell them to the supermarket for the same price at which the supermarket is selling apples. Furthermore, they should be able to take them at any time and receive payment. If the store gets too many local apples, it can reduce its purchase of corporate apples.

My apple proposal may seem ill advised, but that is exactly how rooftop solar power works. The homeowner gets to displace power from the power company, and if the homeowner has more power than he needs, the power company is obligated to purchase it, often for the same retail price at which it sells electricity. That policy is called net metering. In order to accommodate the homeowner’s electric power, the utility has to throttle down some other power plant that produces power at a lower wholesale price.

The exact arrangements for accepting rooftop solar vary by jurisdiction. In some places, net metering is restricted in one way or another.

A large-scale natural gas-generating plant can supply electricity for around 6 cents per kilowatt-hour. Rooftop solar electricity costs, without subsidies, around 30 cents per kilowatt-hour, or five times as much. Average retail rates for electricity in most places are between 8 cents and 16 cents per kilowatt-hour. Yet, paradoxically, the homeowner can often reduce this electric bill by installing rooftop solar.

It is actually worse than forcing the power company to take 30-cent electricity that it could get from a natural gas plant for 6 cents. When the company throttles down a natural gas plant to make room for rooftop electricity, it is not saving six cents, because it already has paid for the gas plant. All it saves is the marginal fuel that is saved when the plant is throttled down to make room for the rooftop electricity. The saving in fuel is about 2 cents per kilowatt-hour. So 30-cent electricity displaces grid electricity and saves two cents.

July 1, 2018

Over-generous subsidies encourage fraud and waste

Filed under: Britain, Economics, Environment, Government — Tags: , , , , , — Nicholas @ 03:00

At Catallaxy Files, Rafe Champion continues discussing Matt Ridley’s book Climate Science: The Facts:

Ridley went on to criticise biodiesel programs and the promotion of diesel cars. Then he mentioned one of the most outlandish schemes – the clearing of forests on the west coast of the US to convert into wood pellets to burn in British furnaces instead of coal to generate electricity. The Daily Mail reported that this was one of the legacies of Energy Secretary Chris Huhne.

    Mr Huhne, who served in the coalition government and was later jailed for perverting the course of justice, championed the energy source in office and is now European chairmen of Zilka Biomass, a US supplier of wood pellets.

Nice work if you can get it.

And then there are the household biomass furnaces in Britain, promoted by Huhne under the Renewable Heat Incentive (RHI) scheme whereby businesses and households pay for a renewable energy boiler upfront then receive payments for up to 20 years depending on the amount of heat they produce.

    Some unscrupulous homeowners can double the amount they produce by using heat generated under the RHI to dry wood or other materials.

    This can then be fed back into the boiler to burn it and generate even more heat – and money from the public purse.

    The scheme was started in 2011 by Chris Huhne, then Liberal Democrat energy secretary, for businesses then extended to domestic customers three years later. Households and firms can apply for grants to switch from fossil fuel heating systems to renewable ones such as biomass boilers, which burn wood pellets, chips or logs.

As the scheme is open to applications until 2021, final payments to participants will run to at least 2041. By this time, the bill for taxpayers is expected to hit £23billion.

Closely related is the the Irish “Cash for Ash” scandal that paid more than the cost of the fuel. An orgy of corruption was sparked by renewables in Spain and there was the strange phenomenon of solar power generated in the dark because the Spanish subsidy was initially so generous is was worthwhile to shine diesel-powered lights on the panels overnight.

June 30, 2018

Wealthy virtue-signalling hurts the poor

Filed under: Books, Economics, Environment, Politics — Tags: , , , , , — Nicholas @ 03:00

At Catellaxy Files, Rafe Champion discusses some of the points raised by Matt Ridley in his recent book:

Essentially, the poor pay for the virtue-signalling of the rich. Dr Matt Ridley opens chapter 14 of Climate Science: The Facts with some blunt claims.

    Here is a simple fact about the world today. Climate change is doing more good than harm. Here is another fact. Climate change policy is doing more harm than good.

On top of that he points out that the poor are carrying the cost of today’s climate policy. That is something for the ALP [Australian Labour Party] and the social justice warriors to think about.

This should remind people of another great postwar example of destructive virtue-signalling – massive foreign aid to the developing nations aka the Third World. That did more harm than good for the people of the Third World, apart from the crony criminals in power. The great Lord Peter Bauer was onto that very smartly, starting in the 1940s and his findings have been consolidated lately, notably by William Easterly [in] The White Man’s Burden: Why the west’s efforts to aid the rest have done so much ill and so little good. There are exceptions to the rule such as hands-on medical care and private education.

Ridley mentions in passing some of the cases where apparently smart people have made very bad calls, starting with a prominent and wealthy leftwinger who he debated on TV. Faced with the charge that climate policy was hurting the poor he replied “But what about my grandchildren?”. As though the future wellbeing of the presumably affluent and privileged grandchildren of the talking head might be threatened by policies that help the poor who are with us at present. Ridley also cited a son of Charles Darwin who thought that eugenic breeding programs were essential to save civilization and Paul Ehrlich who in 1972 predicted that millions would die due to over-population (prompting the one-child policy in China).

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