This is meant to be a way of describing/ discussing some of my photos and miscellaneous thoughts. Your comments and suggestions will be most appreciated. Either English or French are welcome.

Showing posts with label Energy. Show all posts
Showing posts with label Energy. Show all posts

Wednesday, March 21, 2007

Gore: Don't single out cars and trucks to solve global warming

Agree with Al Gore in general or not, his advise regarding the automotive industry makes a lot a sense.


Gore: Don't single out cars and trucks to solve global warming

Harry Stoffer | Automotive News / March 21, 2007 - 11:41 am




WASHINGTON -- Automakers have an ally of sorts -- in Al Gore.

In a highly anticipated appearance before Congress today, the former vice president said he supports higher fuel economy standards. But automakers alone should not be expected to solve global warming, he contended.

"Don't single out cars and trucks," Gore said in a lengthy statement before a pair of House subcommittees. He described emissions from motor vehicles as "only a slice of the problem" and not the biggest slice.

Still, the future Gore envisions would be vastly different. He called for an immediate freeze on greenhouse-gas emissions and a 90 percent cut in those emissions by 2050. He did not say exactly how those moves could be accomplished.

The ranking Republican on the House Energy and Commerce Committee, Rep. Joe Barton of Texas, said a freeze, if taken literally, would mean no new businesses, no economic growth and no more people.

Gore also called for:
  • Taxes on the carbon in fuels, offset by cuts in payroll taxes.
  • U.S. participation in a new international treaty on climate change, which would follow the Kyoto treaty rejected by Congress and the Bush administration.
  • Programs that would encourage consumers to generate their own electricity through means that don't release greenhouse gases into the air.


Gore said such steps are needed to deal with "a crisis that is by far the most serious we have ever faced." He has achieved international recognition for his Oscar-winning documentary on global warming, An Inconvenient Truth.

Auto industry leaders who testified last week before a subcommittee of the Energy and Commerce Committee said they could support a cap on total U.S. emissions. But they said the burden for compliance should be spread across all businesses.

Automakers say that regulators should determine the highest feasible fuel economy standards and that lawmakers should not arbitrarily set tougher standards.

Wednesday, March 14, 2007

It's About Time, But Don't Be Too Subtle

I am glad that someone is taking the lead here, although more directness and coordination (e.g., through AAMA) stands a better chance of driving change (maybe). To read the rest of the article, click on post title.

Industry chiefs: Higher CAFE is not the only answer

Harry Stoffer | Automotive News / March 14, 2007 - 12:44 pm / UPDATED: 3/14/07 2 P.M.





WASHINGTON -- Government should take steps to boost consumer demand for fuel-efficient vehicles, top auto industry executives told lawmakers today.

Simply raising fuel economy standards is not the answer to the threat of global warming or the nation's energy supply concerns, the executives argued.

In Europe, automakers achieve fuel economy levels that some members of Congress want to require in the United States. But much higher gasoline prices in Europe create consumer demand, Chrysler group CEO Tom LaSorda said in prepared testimony before a panel of the House Energy and Commerce Committee.

LaSorda did not call directly for higher U.S. gasoline taxes but said "a new and unique formula" for the United States should include "harnessing of market forces." Other company executives noted that Chrysler has endorsed higher gasoline taxes in the past.

The House panel sought testimony on the industry's role in combating global warming and improving energy security. Called to testify today at the unusual hearing were the CEOs of the Detroit 3; the president of Toyota Motor North America Inc., Jim Press; and UAW President Ron Gettelfinger.

'New approach'

U.S. Rep. John Dingell, D-Mich., chairman of the full committee, signaled before the hearing that he is receptive to ideas beyond corporate average fuel economy standards. In a conference call with reporters Tuesday, March 13, Dingell said: "We need a new approach." He did not elaborate.

....

Wednesday, March 07, 2007

Yet Another Sane Voice on Fuel Taxes

An article in today's Detroit News makes the argument for higher fuel taxes, among other useful points. To read the entire article, click on post title.


....

"Fuel taxes move auto market

"The overriding consideration is that it is fuel taxation policies -- not automakers -- that drive consumers to buy differing vehicle types. If gasoline was priced two or three times higher in the United States and if high quality diesel fuel was available here at a lower cost than gasoline, then you can bet Americans would be interested in much more fuel efficient vehicles.

"In the meantime, with our lifestyle and relatively cheap fuel, there is a good reason that full-size pick-up trucks like the Ford-F-150 and the Chevrolet Silverado have been America's best selling vehicles for decades...."

Tuesday, March 06, 2007

Oil Pumping Innovations: The Whole Story?

There was and interesting article in the New York Times (click on post title to access article) about technologies/techniques which increase the yield from existing oil wells/fields. The article does admit that the costs of recovery using these technologies/techniques cost more than usual pumping, but are still profitable given today's oil market. The article argues that this makes the discussion of "the end of oil" questionable at best.

I am more interested in what the article doesn't say. Not only do these recovery techniques typically cost more, they also often require significant amounts of energy. Thus, the net energy extraction is significantly less than more "normal" techniques.

This means that the net effect on the total amount of energy available is less than one might think, although maybe more oil becomes available if alternative forms of power are used to drive these approaches. However, in most cases, we would probably find that significant amounts of CO2 are generated to increase the extraction of this additional oil, in addition to the CO2 that is generated when the oil is utilized. Thus, the effects on global warming of these "high-tech" extraction techniques is almost certainly adverse.



Friday, March 02, 2007

Ignatius: The Climate Change Precipice

I strongly recommend David Ignatius' column in today's Washington Post entitled "The Climate Change Precipice". Click on post title to read column.

In that article, Ignatius refers to a report by Peter Schwartz of the Global Business Network on this subject: http://media.washingtonpost.com/wp-srv/opinions/documents/gbn_impacts_of_climate_change.pdf

I have just scanned the report, but at first glance it looks excellent. I have been a fan of Peter Schwartz and his approach (systems- and scenario-based) for many years now.

Monday, February 26, 2007

Jerry Brown: Automotive Champion?!

Let's assume that Jerry Brown wants to be constructive. He admits that he has no idea how to change consumer behavior. Let the automakers wave their magic technological wand. I will still argue that suitable purchase and use taxation will be the most effective aid to changing automotive consumer behavior, giving a realistic chance of California's concerns with Global Warming to be addressed in the real world. (click on post title for rest of column.)





EYES ON THE ROAD
By JOSEPH B. WHITE







California, Auto Makers Battle
Over Vehicle Emissions

Flurry of Litigation Over Efforts to Reduce
The Environmental Impact of Cars, Trucks
February 24, 2007, Wall Street Journal

When it comes to automobiles, California isn't just another state. It's something close to a sovereign nation -- a nation currently at war with a fair chunk of the auto industry.

California's recent efforts to regulate carbon dioxide emissions as a pollutant, and to mandate reductions of CO2 emissions, including gases coming out of vehicle tailpipes, has provoked a flurry of litigation with big auto makers. The car companies contend California's efforts to clamp down on CO2 amount to an effort to regulate fuel economy, and states have no right to supersede federal fuel efficiency laws. The state has countered that car makers, by persisting in selling gas guzzlers to Californians, are creating a public nuisance by contributing to the ill effects caused by global warming -- including rising sea levels that could threaten California's 1,075 miles of coastline and dwindling mountain snows that could undermine the state's water supply. (Read the complaint1)

Into this fight comes now California Attorney General Edmund G. Brown -- yes, that Jerry Brown, the former California governor who ran for president three times and more recently was Mayor of Oakland. Mr. Brown inherited the litigation with the auto industry when he took his current office in January. Some have called on Mr. Brown to quit the state's legal fight with the auto industry. But Mr. Brown has chosen a different tack. He has called on the chief executives of the six biggest auto makers in the U.S. market to meet with him to find "cooperative approaches" to the global warming issue. (Read his letter2)

So far, the auto makers have declined, through their attorney, to schedule a CEO summit. Instead they have offered to send "legal representatives" to brief Mr. Brown on the industry's "multi-faceted efforts to improve fuel efficiency." So what does Jerry Brown really want? In a telephone interview, the attorney general says his real goal is to help the car companies.

"This is not a problem that is going to be swept under the rug," he says. "It is getting intense scrutiny. Even a year ago, people would not expect we would be as far into this issue as we are."

....

Mr. Brown also remembers that when he was governor, the auto makers fought seat belts. And he says electric cars, once mandated under California law, "died because the car companies wanted (them) to die."

Industry executives counter that electric cars died because they were exorbitantly expensive, and the vast majority of consumers had no interest in buying them, preferring instead the larger, heavier vehicles Mr. Brown is denouncing.

But Mr. Brown's point is that the auto industry has a long history of insisting that it cannot profitably build cleaner, safer cars -- only to be shown up when such advances turn out to be both possible and profitable.

....

To a significant degree, the dispute between California and the car makers is a culture clash. California has a long history of using its special status as the nation's biggest car market to press for risk-taking on advanced technology. This is what you'd expect from a state whose economy is based to a great degree on nimble, high-tech entrepreneurship.

Auto makers, by contrast, are stuck with a business that involves sinking enormous chunks of capital into machinery and factories staffed by thousands of workers whose labors will yield a return only after several years. Those returns will come only if the car makers haven't misjudged, while planning their vehicles three to five years earlier, consumer tastes or the price of oil. The risks inherent in auto making breed a certain conservatism -- all the more so given the inconsistent track record of various on-board gadgetry.

The other problem is that car makers don't create CO2 emissions by driving cars. People do. Mr. Brown, who says his last car was a Mercury Sable purchased in 1991, concedes that changing Californians' motoring habits won't be easy, he says.

....






Monday, February 12, 2007

Putting the Heat on Global Warming

Yet another voice of reason. To read complete article, click on post title.

John McCormick

Putting the heat on global warming

Detroit News, February 12, 2007

....

All these considerations aside, the rational minds running Motown's automakers are left facing a dilemma. On the one hand they know that the modern automobile is actually responsible for a relatively small part of the emissions 'load' that mankind's activities impose on the earth. At the same time they recognize that cars - versus coal-fired power plants, heavy industry or even the hundreds of jets streaking across our skies daily - are far more visible to the general public. Unjust though it is, the automobile's exhaust pipe has become the poster child for air pollution and, by extension, global warming.

As a consequence, environmentalists repeatedly attack the auto industry as if it is single handedly to blame for the planet's climatic problems, real or imagined. The so-called 'greens' argue that the carmakers must sell vehicles that they think people should buy, rather than the vehicles people want to buy, thus ignoring the most basic tenet of a market driven economy.

These same activists point to General Motors' withdrawal of the plug-in electric car, the EV1, during the 1990s, as proof that the auto industry is not serious about producing environmentally sensitive vehicles. The absurdity of this argument is self-evident. Does anyone truly believe that GM chose to waste billions of dollars on a vehicle that would not succeed? The fact that only a few people bought the EV1 (or any other electric vehicle of the time) was because they were impractical. Consumers in a free market economy buy what they wish to buy; be it a Hummer, Toyota Prius or anything in between.

What influences the vehicle buyer's decision is a subtle combination of desire, practical considerations and dollars and cents. And it is this last factor that should be given the biggest weight as we debate the relationship between the automobile and the world's environment. It is not the job of the automobile industry to tell buyers what to purchase, any more than it is the job of house builders to promote smaller homes. This role is best played by the government, not by direct edict, but by exerting financial pressure on a vehicle purchaser's decision.

The most obvious example of this process in action is Europe's vehicular tax strategy. For example, European governments tax fuel in a manner that encourages diesel, which is much more energy efficient and therefore lower in CO2 emissions than gasoline. They also tax higher displacement engines, leading consumers and therefore automakers to concentrate on smaller, more efficient vehicles. This policy does not prevent consumers from buying larger cars and trucks, it simply makes the choice more expensive.

If a US administration, now or in the future, is ever to make a serious effort to curb this country's appetite for the world's energy resources and corresponding imbalance in overall emissions, then attacking the auto industry with legislation is not the answer. Nor is the misguided focus on grossly inefficient corn-based E85 production. It's wiser to concentrate on producing cellulosic-based ethanol, or much better still, to give major financial assistance to the development of advanced batteries for a new generation of electric cars.

But in the short term, the answer, as tough and unpalatable as it may be in some quarters, is to use taxes, not half baked rhetoric, to persuade consumers to modify their vehicle choices.

John McCormick is a columnist for Autos Insider and can be reached at john.mccormick@detnews.com

Thursday, February 01, 2007

Is that how the State of the Union was drafted?

To see more on this topic, click on the post title above.




Monday, January 29, 2007

Technological Answers to CAFE?

The following article (click on the post title to read all of it) lists several practical and less-practical ways of meeting increased CAFE requirements. The one thing it does not discuss is to how to change consumer behavior, other than differential vehicle pricing.

In fact, in this week's Automotive News there are many articles related to President Bush's comments last week in his State of the Union message. Although I hardly read every line of every article, I saw no mention of fuel taxation in any of them. The subject is simply ignored by what proports to be the most comprehensive newspaper in the automotive industry. Strange.


Bush's shocker: How to meet a higher CAFE


Richard Truett | |

Automotive News | 1:00 am, January 29, 2007


First the good news: In theory, automakers can meet President Bush's call to improve fuel economy simply by commercializing off-the-shelf technologies.

But it's going to cost plenty. If light-vehicle CAFE standards rise by a third by 2017, to 34 mpg, as President Bush proposed last week, we'll see a more small cars, diesels and hybrids.

Here are the technologies that could deliver big gains in fuel economy, along with ratings for practicality and cost. A score of 5 five means the technology could be on your driveway soon. A rating of 1 means the technology is the modern equivalent of the 100-mpg carburetor....




Best bets
How various fuel-saving technologies are likely to fare.
Winners: Turbochargers, diesels, starter generators, efficient transmissions
The jury is out: Lightweight materials, plug-in hybrids
Not in this lifetime: Fuel cells



          • Now that we've rated these technologies, we will offer a caveat on our grades. If Congress approves a steep increase in fuel economy, automakers inevitably will speed up introduction of these technologies.
          • One way to improve CAFE would be to manipulate the marketplace: Raise the price of big trucks and other gas hogs, then lower the price of smaller, more fuel-efficient vehicles. In the world of CAFE, this is a time-honored technique.

            So maybe we'll have to switch to pass-fail grades after all.

Thursday, January 25, 2007

Gasoline: Price Matters

The following is an exerpt of an interesting article from the LA Times. To read all of it, click on the post title above.

To read a summary of the Cambridge Energy Research Associates report cited in the article, go to:

http://www2.cera.com/gasoline/summary/

All in all, this confirms my conviction that higher gasoline taxes will significantly change consumer behavior.

U.S. motorists cutting back a bit

Americans cut miles driven for the first time since 1980. High prices are behind the change in transportation habits.
By Elizabeth Douglass
Los Angeles Times Staff Writer

January 25, 2007

Two years of record-high gasoline prices have forced auto-crazed Americans to do something they haven't done in more than two decades: Drive less. ...


Other reports over the last year on mass transit ridership, total miles driven nationwide, gasoline demand, vehicle sales and retail and restaurant spending reinforce the notion that U.S. drivers made significant — and in some cases, lasting — adjustments to offset steadily rising gasoline prices.

"In 2005 and into 2006, we did see consumers start to change their driving behavior," said David Portalatin, director of industry analysis at NPD Group Inc., which tracks consumer spending. "That's a very hard thing to change, because I've either got to change where I work, where I live, or what kind of car I drive in order to actually consume less gasoline."

It's a small but important shift for a nation that many believed was impervious to rising gas prices because drivers were unable or unwilling to rein in their gas-guzzling ways. Lofty energy costs have generated such concern that President Bush devoted a significant chunk of his last two State of the Union speeches to addressing the nation's oil addiction.

"The message is that price matters," said Daniel Yergin, chairman of Cambridge Energy Research Associates, a Boston-area consulting company that recently published an analysis called "Gasoline and the American People." The study highlighted the decline in per-driver mileage and a cooling appetite for the largest sport utility vehicles, among other things, and concluded that expensive gasoline was transforming "America's love affair with the automobile."

Even though pump prices have dropped substantially from their highs in 2006, "there's a greater sense of insecurity, and people don't want to be caught emptying their wallet at the gasoline pump," said Yergin, author of "The Prize," a Pulitzer-winning history of the oil industry....

While high prices cut into the expected growth rate, U.S. gasoline consumption nonetheless increased by about 1% in 2006 after staying flat the previous year. "The gasoline consumed since that August peak in gasoline prices is up nearly 2.5% versus the comparable time period a year ago," said Portalatin, the NPD researcher. "What it means is that consumers have a short memory."

Retiree Joe McElroy of Fountain Valley admits to being a backslider. When local gas costs jumped last summer, McElroy consolidated errands and trimmed trips to visit Riverside relatives. But, he acknowledged, "when prices eased up, I kind of relaxed on that cutback and went ahead and did a little more driving."

That response is what economists have come to expect. Decades of studies invariably conclude that big spikes in prices at the pumps produce only tiny short-term cutbacks in demand. If that research is any guide, whatever changes motorists made during the recent gas-price spikes would be wiped out by recently plunging prices outside of California.

But some transportation experts say that a handful of new factors are starting to turn the tide, causing some consumption changes to stick despite lower prices....

Wednesday, January 24, 2007

Energy and the State of the Union

One of President's Bush's major themes in last night's State of the Union message was energy independence, wherein he proposed some "painless for the electorate" initiatives. I was disappointed, but not at all surprized, that there was no mention of changing consumer behavior in significant ways, such as by increasing fuel taxes. Biofuels are, as the following column says, may be good ideas but will not significantly impact energy independence in the foreseeable future. Playing around with CAFE will not probably have much real impact (other that causing the auto industry problems) if consumers have no economic reason to choose smaller, lighter vehicles and drive less and more slowly.

Nor was it surprising that President Bush had nothing to say about stationary sources of CO2. Apparently, he still doesn't believe in global warming.



Blindness on Biofuels

By Robert J. Samuelson
Wednesday, January 24, 2007; A23, Washington Post

President Bush joined the biofuels enthusiasm in his State of the Union address, and no one can doubt the powerful allure. Farmers, scientists and venture capitalists will liberate us from insecure foreign oil by converting corn, prairie grass and much more into gasoline substitutes. Biofuels will even curb greenhouse gases. Already, production of ethanol from corn has surged from 1.6 billion gallons in 2000 to 5 billion in 2006. Bush set an interim target of 35 billion gallons in 2017 on the way to the administration's ultimate goal of 60 billion in 2030. Sounds great, but be wary. It may be a mirage.

The great danger of the biofuels craze is that it will divert us from stronger steps to limit dependence on foreign oil: higher fuel taxes to prod Americans to buy more gasoline-efficient vehicles and tougher federal fuel economy standards to force auto companies to produce them. True, Bush supports tougher -- but unspecified -- fuel economy standards. But the implied increase above today's 27.5 miles per gallon for cars is modest, because the administration expects gasoline savings from biofuels to be triple those from higher fuel economy standards.

The politics are simple enough. Americans dislike high fuel prices; auto companies dislike tougher fuel economy standards. By contrast, everyone seems to win with biofuels: farmers, consumers, capitalists. American technology triumphs. Biofuels create rural jobs and drain money from foreign oil producers. What's not to like? Unfortunately, this enticing vision is dramatically overdrawn....

To read the rest of this column, go to:

http://www.washingtonpost.com/wp-dyn/content/article/2007/01/23/AR2007012301562.html


Dan Howes of the Detroit News has some interesting reactions to President Bush's energy declarations in last night's State of the Union Message. To see them, go to:

http://www.detnews.com/apps/pbcs.dll/article?AID=/20070124/AUTO02/701240347/1148

To see the New York Times article of this part of the speech, go to:

http://www.nytimes.com/2007/01/24/washington/24energy.html?_r=1&oref=slogin

The Wall Street Journal take on the subject:

http://online.wsj.com/article/SB116957395027385156.html?mod=hps_us_pageone



Following are summaries of the President's energy proposals:

From the Detroit Free Press:

http://www.freep.com/apps/pbcs.dll/article?AID=/20070124/BUSINESS01/701240403/1002/


"Here are some details of President George W. Bush's 20 in 10 proposal. To reduce U.S. gasoline consumption by 20% by 2017, Bush wants to:

• Increase requirements for renewable fuels to 35 billion gallons a year by 2017. The current targets call for 7.5 billion gallons by 2012. This increase would account for a 15% reduction in gasoline use.

• Increase fuel economy by about 4% a year, starting with the 2010 model year for cars and 2012 for trucks. This would save up to 8.5 billion gallons of gas a year, the additional 5% reduction toward the goal.

If met, the moves would reduce U.S. gas consumption in 2017 to below today's levels and halt the increase in global warming gases from vehicles."

From the Detroit News:

http://www.detnews.com/apps/pbcs.dll/article?AID=/20070124/POLITICS/701240421/1148/

"Autos/energy
  • Slash gasoline consumption by up to 20 percent by 2017, primarily by increasing the amount of ethanol and other alternative fuels the federal government mandates must be produced.
  • Give federal officials authority to raise auto fuel mileage standards, allowing automakers to trade or "bank" credits among models.
  • Double the capacity of the Strategic Petroleum Reserve -- a protection against emergency oil market disruptions caused by terrorism or natural disaster -- to 1.5 billion and fill it by 2027."
  • Friday, January 19, 2007

    Energy New Deal

    I like Friedman's argument for what I call "push-pull" energy policy.

    January 19, 2007
    Op-Ed Columnist, New York Times

    A Warning From the Garden

    Well, so much for our daffodils! They all bloomed in our front yard last week. They now form a nice bright yellow cluster at the bottom of our driveway. Temperatures of 65 degrees in Washington in January will do that. Frankly, daffodils in January do brighten up the lawn. Maybe next year we’ll try for roses in February.

    ....

    Even the White House seems to have noticed. Al Hubbard, the president’s economic adviser, says Mr. Bush will soon unveil an energy independence strategy that will produce “headlines above the fold that will knock your socks off.” Since everything the president has done on energy up to now has left my socks firmly in place, I will be eager to hear what Mr. Bush says.

    ....

    What would be compelling? I used to think it would be a “Manhattan Project” on energy. I don’t any longer. I’ve learned that there is no magic bullet for reducing our dependence on oil and emissions of greenhouse gases — and politicians who call for one are usually just trying to avoid asking for sacrifice today.

    The right rallying call is for a “Green New Deal.” The New Deal was not built on a magic bullet, but on a broad range of programs and industrial projects to revitalize America. Ditto for an energy New Deal. If we are to turn the tide on climate change and end our oil addiction, we need more of everything: solar, wind, hydro, ethanol, biodiesel, clean coal and nuclear power — and conservation.

    It takes a Green New Deal because to nurture all of these technologies to a point that they really scale would be a huge industrial project. If you have put a windmill in your yard or some solar panels on your roof, bless your heart. But we will only green the world when we change the very nature of the electricity grid — moving it away from dirty coal or oil to clean coal and renewables. And that is a huge industrial project — much bigger than anyone has told you. Finally, like the New Deal, if we undertake the green version, it has the potential to create a whole new clean power industry to spur our economy into the 21st century.

    To spark a Green New Deal today requires getting two things right: government regulations and prices. Look at California. By setting steadily higher standards for the energy efficiency of buildings and appliances — and creating incentives for utilities to work with consumers to use less power — California has held its per-capita electricity use constant for 30 years, while the rest of the nation has seen per- capita electricity use increase by nearly 50 percent, according to the Natural Resources Defense Council. That has saved California from building 24 giant power plants.

    ....

    But prices also matter. I don’t care whether it is a federal gasoline tax, carbon tax, B.T.U. tax or cap-and-trade system, power utilities, factories and car owners have to be required to pay the real and full cost to society of the carbon they put into the atmosphere. And higher costs for fossil fuels make more costly clean alternatives more competitive.

    ....

    This isn’t rocket science. Government standards matter. They drive innovation and efficiency. And prices matter. They drive more and cleaner energy choices. So when the president unveils his energy proposals, if they don’t call for higher efficiency standards and higher prices for fossil fuels — take your socks off yourself. It’s going to get hot around here.

    Thursday, December 28, 2006

    More Argument for Higher Fuel Taxes

    Why can't most people understand this? Maybe, they all like the idea of a free lunch.


    At Witz’ End: No Free Lunch at CAFE
    You can’t get fuel economy for free.

    There are those who understand and accept the laws of physics, and those who don't. Unfortunately, the latter group is a vast majority with no technical education or experience and clearly includes every lawmaker, environmentalist, and media member who believes that CAFE (Corporate Average Fuel Economy) needs to be substantially increased.

    To believe that, these technically challenged people must believe: 1) that U.S. automakers continue to lag behind imports in fuel efficiency, 2) that they are withholding fuel economy technology that would make everyone's vehicles far more fuel efficient than they are today, but otherwise unchanged 3) that they must be forced to provide the higher mileage their customers demand, and 4) that 40-50-mpg vehicles - even if technically feasible - will offer the same features and capabilities at the same prices as today's 20-30-mpg cars and trucks.

    But those armed with engineering knowledge and facts know the unfortunate truth.

    Domestic makers can offer real data proving otherwise all day long, but people believe what they want to believe. And for some masochistic reason, they still want to believe their home teams are losing. Yes, at the dawn of CAFE in the wake of the 1970s fuel crises, American cars were less fuel efficient than European and Japanese models because they were bigger and heavier, and because fuel economy was not a high priority with U.S.-market gas ridiculously cheap. Today, with domestics selling plenty of excellent small cars and off-shore brands marketing more and more large, heavy luxury cars and trucks, that is not even remotely true. Pound for pound, dollar for dollar, fuel economy is a top priority for everyone, everyone is competitive and any differences between competing vehicles are small.

    There is no magic technology…and if there were, why would American makers withhold it when superior fuel economy is a HUGE competitive advantage? And why would anyone with half a brain believe that any business must be forced to provide what its customers demand?

    Fuel efficiency is mostly about weight. Depending on the rate of acceleration, it takes x amount of energy to accelerate y mass to z speed. Once it reaches that speed, aerodynamics play a major role because slipperier shapes require less energy to part the air. No one should be surprised that big, heavy, brick-shaped trucks burn a lot more fuel than small, light, sleekly shaped cars. Driving style (jerky/aggressive vs. smooth and gentle), tire rolling resistance, accessory loads, and even powertrain technology play much a smaller roles. Increasing efficiency through expensive technology usually adds more cost than benefit at U.S. gas prices. Smaller displacement reduces performance and load capability with little economy benefit, since a smaller engine works much harder than a larger one to pull the same load.

    Engineers can reduce a vehicle's fuel consumption primarily by reducing its size and weight and secondarily by streamlining its body. Beyond these major factors, what remains are incremental enhancements in powertrain and vehicle efficiency. But the easiest and most affordable improvements were made long ago. What remains are measures worth fractions of miles per gallon at much higher costs.

    Cars and trucks weigh what they do primarily because of their capabilities. They are the size and weight they are to carry what they do, perform as they do, tow what they can, and protect occupants in crashes as well as they do, at a given price level. A higher-economy SUV, for example, is by definition smaller and less capable. What combination of features and capabilities are buyers willing to sacrifice for higher efficiency: Cargo capacity? Off-road or all-weather capability? Towing capability? Roominess? Ride? Occupant protection? Affordability?

    CAFE mandates the sales-weighted average economy of the total "fleets" of cars and trucks each company sells each year. It therefore reflects the "mix" of vehicles - the proportion of smaller to larger ones - an automaker sells, not the efficiency of individual vehicles within that mix. A full-line automaker naturally has a lower CAFE than most smaller companies because it sells more larger cars and trucks. To meaningfully raise its CAFE, an automaker has to downsize its mix of vehicles by convincing its customers to buy more, smaller, more fuel-efficient models and fewer of the larger, less efficient ones most Americans prefer.

    "If you want people to eat less, you raise the price of food," GM Product Development Vice Chairman Bob Lutz once sagely said. "Instead, what the government is trying to do with CAFE is fight national obesity by making the clothing industry manufacture only small sizes."

    Those who naively push for higher CAFE believe they'll get 50-mpg cars and 40-mpg SUVs with the same safety and capability they enjoy today at about the same price. They think they can have something for nothing - the proverbial "free lunch" - because they desperately want it. Ain't gonna happen, folks, because no one has figured out how to repeal those pesky laws of physics. What they'll get with higher CAFE is exactly what most Americans do not want - vehicles that are much smaller, lighter, less capable, less safe, and more expensive.

    Contrary to what politicians and the popular press want us to believe - and as much as we all wish there were - there is no free lunch at this CAFE.

    Monday, December 25, 2006

    Shared Concerns on Energy

    Here is an area where the U.S. and Europe have common interests, if slightly different problems. Unfortunately, as this commentary points out, Europe once again cannot coalesce on a policy, making it essentially impossible for the U.S. to enter into the equation. Lugar's proposal, outlined below, should provide a useful starting point for discussion.


    The New Threat To Europe

    By Jackson Diehl
    Monday, December 25, 2006; A29, Washington Post

    This year began with a European energy crisis caused by Russia's cutoff of gas supplies to Ukraine, where a democratic government not to the liking of Vladimir Putin had taken power. Because Russian gas passes through Ukraine on its way to Western Europe, the pressure also dropped in Paris and Vienna and Rome -- and Europeans suddenly realized they were dependent for electricity and warmth on an autocracy that was prepared to use energy as a tool of imperialism.

    It looks like the year will end the same way. Georgia and Azerbaijan, two other Russian neighbors that have chosen not to kowtow to Putin, are scrambling to find gas supplies by Jan. 1 to make up for Russian cutbacks or to avoid a huge and predatory price increase. So, oddly, is Belarus, which until now has been a Kremlin client -- but which has resisted a Russian demand that it turn over ownership of a key gas transit pipeline. Western energy companies that have invested in Russia are meanwhile reeling from a crude campaign of bullying designed to force them to give up majority stakes in oil and gas fields to Kremlin-controlled companies. Shell has already caved, allowing Gazprom to take a 50 percent stake in a huge offshore gas field.

    It would be nice to report that in the intervening months Western governments have taken steps to ensure that Russia, which supplies anywhere between 30 and 100 percent of the gas consumed by European Union countries as well as much of their oil, is not able to use this leverage for political or economic extortion. Sadly, the opposite is true: Though "energy security" has become a favorite topic for discussion at E.U. and transatlantic summits, next to nothing has been done about it.

    That's partly because solutions aren't easy. Weakening Russia's hold over European energy supplies requires measures that would be costly and difficult, such as building new terminals for importing liquefied natural gas or new pipelines to carry oil and gas from Central Asia and the Caucasus to Europe.

    There's a less excusable problem, however: the failure of European Union governments to agree on either a common energy strategy or a policy for responding to Russia's growing aggressiveness. Some politicians, like German Foreign Minister Frank-Walter Steinmeier, propose a new Ostpolitik that would entice Russian cooperation with offers of economic and strategic partnership. Others say the E.U. should refuse to renew an expiring economic pact with Russia unless it stops trying to monopolize European energy supplies.

    Though it has a vital stake, the United States has been mostly missing from the discussion. That's one reason a recent speech by Sen. Richard Lugar (R-Ind.), the outgoing chairman of the Senate Foreign Relations Committee, was intriguing. Lugar has been a pioneer of some of the most farsighted U.S. policies toward the countries of the former Soviet Union, including the Nunn-Lugar program for securing and dismantling nuclear weapons and materials.

    Now he's proposing that the NATO alliance formally adopt "energy security" as one of its central missions. NATO, he told a German Marshall Fund conference alongside the recent NATO summit in Riga, Latvia, is "used to thinking in terms of conventional warfare between nations. But energy could become the weapon of choice for those who possess it.

    "A natural gas shutdown to a European country in the middle of winter," he added, "could cause death and economic loss on the scale of a military attack."

    NATO, Lugar said, should resolve to treat "an attack using energy" the same way it would a land attack by conventional military forces -- that is, an attack on one country would compel a response by all. That doesn't mean military action, he said; "rather, it means the alliance must commit itself to preparing for and responding to attempts to use the energy weapon against its fellow members."

    Lugar pointed out that NATO used to hold exercises to prepare for the logistical and supply challenge of responding to a Soviet attack. A new exercise, he said, "should focus on how the Alliance would supply a beleaguered member with the energy resources needed to withstand geo-strategic blackmail." This wouldn't be easy, he acknowledged: In fact, "the energy threat is more difficult to prepare for than a ground war in Central Europe." Guarding against an energy cutoff by Russia will mean massive investments in new supply lines and reserve supplies, as well as the means to distribute them in a crisis.

    That sounds daunting at a time when NATO has its hands full trying to fight a war in Afghanistan. But the energy threat goes to the alliance's historic purpose: defending democratic Europe from attack by the autocratic and belligerent power on its Eastern frontier. And, as Lugar pointed out: "The use of energy as an overt weapon is not a theoretical threat of the future. It is happening now."

    Thursday, December 14, 2006

    A Well-Intentioned (?) Foolishness

    I see that a group of retired military officers and big energy users are calling for steadily increasing CAFE regulations to solve our energy dependence on foreign sources. As readers of my blog know, I feel strongly that this approach is inadequate. Raising CAFE will not per se change consumer behavior. It will take parallel increases in fuel taxes to do so. Perhaps it is not too surprising that this group does not advocate such an approach, given that its non-military members are all large consumers of fuel or petroleum-based feedstocks.

    For more on the Energy Security Leadership Council, go to their web site:

    http://www.secureenergy.org/energycouncil_about.php


    Group seeks tough fuel efficiency standards

    Foreign oil called threat to security

    BY JUSTIN HYDE
    FREE PRESS WASHINGTON STAFF

    December 14, 2006

    WASHINGTON -- A group of corporate chief executives and retired military generals called Wednesday for the federal government to raise fuel economy standards by 4% a year and take other steps toward cutting U.S. oil imports almost in half from today's levels by 2030.

    The push from the Energy Security Leadership Council adds to a growing movement in Washington for toughening fuel-efficiency standards for vehicles, especially the 27.5 miles per gallon standard for passenger cars set by Congress in 1975. Industry executives say the debate around Capitol Hill has shifted from whether an increase is necessary to what form it will take when Congress convenes next year.

    The council includes the chief executives of FedEx, UPS and Dow Chemical and top executives from Southwest Airlines and Goldman Sachs, along with several retired U.S. military commanders. They contend U.S. reliance on foreign sources of energy gives adversaries in parts of the world too much leverage over the U.S. economy.

    "We're now far more vulnerable than we were in the '70s," said Robert Hormats, vice chairman of Goldman Sachs' international unit. "The disruption that could occur ... could be extremely serious."

    Their main proposal would require federal regulators to reform standards for cars as they did for trucks last year, setting a goal based on a vehicle's size rather than a single number for the entire fleet. Regulators would assume 4% annual increases but could delay those if they found the industry couldn't meet them.

    The group also proposed fuel-efficiency standards for heavy-duty trucks, as well as more incentives for alternatives to oil such as ethanol. They estimate their proposals would save just under half of the U.S. daily consumption.

    While the auto industry has opposed increases in fuel economy standards for years, a number of executives and lawmakers say the change of power in Congress and growing concern about American dependence on foreign oil make an increase likely.

    Automakers have not opposed a proposal by the Bush administration to let federal regulators set new standards for passenger cars, but most, including the Alliance for Automobile Manufacturers, object to an automated increase, saying only the National Highway Traffic Safety Administration has the expertise to raise standards.

    "We believe that technology remains the successful formula for progress toward reducing our dependence on foreign oil," said GM spokesman Greg Martin.

    Tuesday, December 12, 2006

    Energy Progressivism

    Well worth a read. To read complete article, click on post title. The link to the McKinsey Global Institute report is:

    http://www.mckinsey.com/mgi/publications/Global_Energy_Demand/index.asp


    December 12, 2006, New York Times
    The Energy Challenge

    The Cost of an Overheated Planet

    The iconic culprit in global warming is the coal-fired power plant. It burns the dirtiest, most carbon-laden of fuels, and its smokestacks belch millions of tons of carbon dioxide, the main global warming gas.

    So it is something of a surprise that James E. Rogers, chief executive of Duke Energy, a coal-burning utility in the Midwest and the Southeast, has emerged as an unexpected advocate of federal regulation that would for the first time impose a cost for emitting carbon dioxide. But he has his reasons.

    “Climate change is real, and we clearly believe we are on a route to mandatory controls on carbon dioxide,” Mr. Rogers said. “And we need to start now because the longer we wait, the more difficult and expensive this is going to be.”

    Global warming is not only an environmental hazard, but also a great challenge for economic policy. Without economic incentives, analysts say, the needed investments in industrial cleanup, innovative low-carbon technologies, fuel-efficient cars and other ways of reducing energy waste will not occur.

    Mr. Rogers’s stance is far from universal within the power industry, but it has surprising support, particularly from those, like him, who also produce electricity from carbon-free nuclear reactors.

    And despite the Bush administration’s adamant opposition to any limits on fossil fuel emissions, the idea is beginning to pick up momentum in the American political arena as well. Already, California has adopted a policy aimed at reducing the state’s contribution to global warming by 25 percent in the next 14 years.

    In Washington, several influential lawmakers, including Senator John McCain, a leading Republican contender for president in 2008, have introduced legislation intended to limit the nation’s carbon dioxide output.

    But how would those goals be achieved? Global warming can be seen as a classic “market failure,” and many economists, environmental experts and policy makers agree that the single largest cause of that failure is that in most of the world, there is no price placed on spewing carbon dioxide into the atmosphere.

    Yet it is increasingly clear that there is a considerable cost to carbon dioxide emissions, especially to future generations, as climate specialists warn of declines in farm output in poor tropical countries, fiercer hurricanes and coastal floods that could make many people refugees....

    Sunday, December 10, 2006

    The Supreme Court and Global Warming

    The following article raises some interesting points of the hearing last week regarding EPA regulation of CO2. Some other interesting articles include:

    http://select.nytimes.com/search/restricted/article?res=F30A14F8355A0C738FDDA80994DE404482

    http://www.washingtonpost.com/wp-dyn/content/article/2006/11/29/AR2006112900169.html

    http://www.npr.org/templates/story/story.php?storyId=6556413


    As the article which follows points out, we will probably need additional legislation. However, even this won't do much, in my opinion, until we motivate individuals and industries to change environmental behavior. Both carrots and sticks (or what I like to call "pull-push" policy) are in order.








    COMMENT
    HOT AND COLD
    by Elizabeth Kolbert
    Issue of 2006-12-11
    Posted 2006-12-04

    Thirty-six years ago this month, President Nixon signed the Clean Air Act in a ceremony in the Roosevelt Room of the White House. The act—the product of a bipartisan effort extraordinary even for a day when bipartisanship was unexceptional—had been hammered out by a group of senators that included Democrats Edmund Muskie, Birch Bayh, and Thomas Eagleton, and Republicans Bob Dole, Howard Baker, and Robert Packwood. The bill passed the Senate unanimously, prompting Senator Eugene McCarthy to tell Muskie, “Ed, you finally found an issue better than motherhood.” At the signing ceremony, Nixon called the Clean Air Act a “historic piece of legislation,” but he stressed that it was only a first step. “I think that 1970 will be known as the year of the beginning,” he said.

    Nostalgia for the Nixon Administration is an increasingly acceptable emotion these days, and it was hard not to feel it last week, when oral arguments were heard in Massachusetts v. Environmental Protection Agency. The suit, which has been described as “one of the most important environmental cases ever,” is the first on global warming to reach the United States Supreme Court. The plaintiffs—a group that includes, in addition to Massachusetts, eleven states, three cities, and thirteen environmental groups—hope to compel the Bush Administration to impose limits on greenhouse-gas emissions. If they are successful, the operation of every power plant and factory as well as the design of every new car in the country could potentially be affected. At the center of the suit is the Clean Air Act, and the question of just how ambitious its authors intended it to be.

    The Bush Administration’s position, in keeping with its general stance toward regulation but in contrast to its general stance toward executive power, is that its hands are tied. The E.P.A., it argues, lacks the authority to limit greenhouse gases under the Clean Air Act, because when the act was drafted global warming wasn’t yet recognized as a problem. The “relevant provisions of the law,” it states in its brief to the Supreme Court, are “best construed not to authorize regulation . . . for the purpose of addressing global climate change.” Furthermore, the Administration asserts, even if the Clean Air Act did grant the E.P.A. the power to treat CO2 as a pollutant, the agency shouldn’t—and wouldn’t—exercise it.

    Just about anyone familiar with the Clean Air Act can see the White House’s narrow reading of the law for what it is: a deliberate misreading. The act was expressly constructed to allow the E.P.A. to regulate substances known to be dangerous and also substances that might in the future be revealed to be so. Danger was defined as broadly as possible; among the many possible hazards listed in the statute are “effects on soils, water, crops, vegetation, manmade materials, animals, wildlife, weather, visibility, and climate.” In a friend-of-the-court brief for the plaintiffs, four former E.P.A. administrators—including Russell Train, who headed the agency under Nixon, and William Reilly, who led it under George Bush senior—point out that Congress clearly directed the E.P.A. to “regulate air pollution based on new and changing scientific information.” The four go on to note that the E.P.A. has, many times in the past, used its authority to control pollutants whose dangers could not have been foreseen in 1970; for example, in the early nineteen-nineties, faced with data on ozone depletion, the agency issued a timetable for phasing out chlorofluorocarbons.

    But just because the Bush Administration is willfully misconstruing the Clean Air Act doesn’t mean that it will lose. Massachusetts v. Environmental Protection Agency comes to the Supreme Court via the D.C. Circuit Court, whose three-judge panel issued three disparate opinions on the case. One of the judges ruled for the states. The second ruled for the E.P.A., on the ground that the agency could decline to regulate greenhouse gases if it chose. The third sided with the second, but gave different reasons: the plaintiffs, he asserted, lacked the standing to sue, since they were suffering no particularized harm (beyond the danger to humanity at large). During last week’s oral arguments, the plaintiffs’ standing was the focus of fully half the questions. James Milkey, the Massachusetts assistant attorney general who argued the case on behalf of the states, was midway through an explanation of how coastal regions would be especially hard hit by global warming when Justice Antonin Scalia interrupted him.

    SCALIA: I thought that standing requires imminent harm. If you haven’t been harmed already, you have to show the harm is imminent. Is this harm imminent?
    MILKEY: It is, Your Honor. We have shown that [rises in] sea levels are already occurring from the current amounts of greenhouse gases in the air, and that means it is only going to get worse as the—
    SCALIA: When? I mean, when is the predicted cataclysm?

    Meanwhile, from the plaintiffs’ perspective, even a victory could be vexed. Should the court decide that the states have standing and that the E.P.A. has the authority to regulate greenhouse gases, responsibility for writing those regulations would still fall to the agency. Given who’s in charge of the E.P.A. these days, it’s hard to see how this would represent a solution. (Imagine entrusting campus alcohol policy to the guys at Delta Tau Chi.)

    The Bush Administration’s indifference to global warming might seem at this point like just one of many failures—of will, of imagination, of leadership. In future decades, it will come to seem more significant: at a moment when there was still a chance to avert the worst effects of climate change, the United States couldn’t be bothered to.

    The plaintiffs in Massachusetts v. Environmental Protection Agency have brought the suit out of desperation. What is really needed, as they would be the first to acknowledge, is immediate action on a scale commensurate with what’s at stake: not an invocation of the Clean Air Act but a new law of comparable vision that would lay out clear—and aggressive—targets for greenhouse-gas reductions. The Democrats should use their newly won congressional majorities to pass such legislation, and President Bush, following Nixon’s example, should sign it. That, at least, would be a beginning.

    Friday, October 20, 2006

    Raise the Gas Tax

    The attached editorial, which appeared today in the Wall Street Journal, brought up a subject that I have meant to discuss. For many years now, I have been in favor of significantly higher fuel taxes in the United States. I am glad that Mr. Mankiw has opined in favor of this general approach. My own justification of this policy focuses on energy independence (in the medium-term) and environmental benefit (in the longer term).



    However, I would make the following comments on his editorial:

    1. He is too timid as to the rate of rise and the desired ultimate fuel tax rate to be targeted. One dollar per gallon more taxes, to be attained in $ 0.10 increments over ten years is simply not meaningful enough to structurally change consumer behavior. Although I have not studied the matter, this is an policy area which is susceptible to serious analytical work. My own guess would be that a total increase of $ 3 per gallon is more like it. This could be approached by increases of $ 0.25 per gallon per year for the first four years, followed by increases of $ 0.50 per gallon per year thereafter until the desired level of taxation is attained.
    2. Since the United States is large and housing is increasingly far from work, public transport is spotty at best, and the poor would have to retain the current fuel in-efficient fleet the longest, such an aggressive increase in fuel taxes would hit some people extremely hard. This could be mitigated by something like the refundable earned income tax credit for those disproportionately adversely impacted.
    3. In order to have the best effect, these taxes would have to be permanent. Consumer behavior will most likely change the fastest if consumers were convinced that the increased taxes are permanent. Likewise, automotive industry, fuel supply industry, alternative propulsion, and infrastructure investment will happen faster and more smoothly if decision-makers are convinced of a real shift in market desires. Let's not opt for an "on-again, off-again" set of taxes (like the R&D tax credit).
    Is this politically feasible? Not in today's political climate, unfortunately. It will take more positive leadership and less partisan doctrine than either the Administration or the Congress seem able to muster.



    Raise the Gas Tax

    By N. GREGORY MANKIW
    October 20, 2006; Page A12

    With the midterm election around the corner, here's a wacky idea you won't often hear from our elected leaders: We should raise the tax on gasoline. Not quickly, but substantially. I would like to see Congress increase the gas tax by $1 per gallon, phased in gradually by 10 cents per year over the next decade. Campaign consultants aren't fond of this kind of proposal, but policy wonks keep pushing for it. Here's why:

    The environment. The burning of gasoline emits several pollutants. These include carbon dioxide, a cause of global warming. Higher gasoline taxes, perhaps as part of a broader carbon tax, would be the most direct and least invasive policy to address environmental concerns.

    Road congestion. Every time I am stuck in traffic, I wish my fellow motorists would drive less, perhaps by living closer to where they work or by taking public transport. A higher gas tax would give all of us the incentive to do just that, reducing congestion on streets and highways.

    Regulatory relief. Congress has tried to reduce energy dependence with corporate average fuel economy standards. These CAFE rules are heavy-handed government regulations replete with unintended consequences: They are partly responsible for the growth of SUVs, because light trucks have laxer standards than cars. In addition, by making the car fleet more fuel-efficient, the regulations encourage people to drive more, offsetting some of the conservation benefits and exacerbating road congestion. A higher gas tax would accomplish everything CAFE standards do, but without the adverse side effects.

    The budget. Everyone who has studied the numbers knows that the federal budget is on an unsustainable path. When baby-boomers retire and become eligible for Social Security and Medicare, either benefits for the elderly will have to be cut or taxes raised. The most likely political compromise will include some of each. A $1 per gallon hike in gas tax would bring in $100 billion a year in government revenue and make a dent in the looming fiscal gap.

    Tax incidence. A basic principle of tax analysis -- taught in most freshman economics courses -- is that the burden of a tax is shared by consumer and producer. In this case, as a higher gas tax discouraged oil consumption, the price of oil would fall in world markets. As a result, the price of gas to consumers would rise by less than the increase in the tax. Some of the tax would in effect be paid by Saudi Arabia and Venezuela.

    Economic growth. Public finance experts have long preached that consumption taxes are better than income taxes for long-run economic growth, because income taxes discourage saving and investment. Gas is a component of consumption. An increased reliance on gas taxes over income taxes would make the tax code more favorable to growth. It would also encourage firms to devote more R&D spending to the search for gasoline substitutes.

    National security. Alan Greenspan called for higher gas taxes recently. "It's a national security issue," he said. It is hard to judge how much high oil consumption drives U.S. involvement in Middle Eastern politics. But Mr. Greenspan may well be right that the gas tax is an economic policy with positive spillovers to foreign affairs.

    Is it conceivable that the policy wonks will ever win the battle with the campaign consultants? I think it is. Even after a $1 hike, the U.S. gas tax would still be less than half the level in, say, Great Britain, which last I checked is still a democracy. But don't expect those vying for office to come around until the American people recognize that while higher gas taxes are unattractive, the alternatives are even worse.

    Mr. Mankiw, a professor at Harvard, was chairman of the Council of Economic Advisers from 2003 to 2005.