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A Feasible Alternative to Coal



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Today’s Wall Street Journal (subscription required) reports on the recent discovery of a large natural gas deposit in Northern Louisiana.

CADDO PARISH, La. — A massive natural-gas discovery here in northern Louisiana heralds a big shift in the nation’s energy landscape. After an era of declining production, the U.S. is now swimming in natural gas.

Even conservative estimates suggest the Louisiana discovery — known as the Haynesville Shale, for the dense rock formation that contains the gas — could hold some 200 trillion cubic feet of natural gas. That’s the equivalent of 33 billion barrels of oil, or 18 years’ worth of current U.S. oil production. Some industry executives think the field could be several times that size.

Huge new fields also have been found in Texas, Arkansas and Pennsylvania. One industry-backed study estimates the U.S. has more than 2,200 trillion cubic feet of gas waiting to be pumped, enough to satisfy nearly 100 years of current U.S. natural-gas demand.

Quick primer on natural gas: Its carbon impact is roughly half of coal’s. It has multiple energy uses. It’s found right here at home. Politicians have placed much of it off limits — yet they want us off of coal. Good luck with that, without much more natural gas. And nuclear.

No Feasible Alternative to Oil



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The Freakonomics item I excerpted yesterday? Navy Bob will have none of it:

Interesting articles cited by Dubner, but he makes the same error every other energy pundit seems to make — that new or more efficient ways to produce electricity will somehow replace oil.

 

There’s no connection between oil and electricity. Schemes to produce more electricity from tidal and wave power and transmit it more efficiently through ultra-high-voltage power lines will not reduce oil consumption or imports by a single barrel. They’re dreamed up for environmental reasons (or potential cost savings in the case of more efficient transmission.). Oil is not burned to produce electricity except in isolated and insignificant amounts. The electricity that flows through transmission lines to our homes and factories comes from coal, nukes, dams, natural gas, and the occasional windmill and solar panel. We could increase electricity production a hundredfold from all sources, and we’d still need the same amount of oil. Oil is produced and imported to make fuel for vehicle engines — gasoline, diesel fuel and jet fuel. All the other petroleum products produced from a barrel — heating oil, bunker C, lubricating oil, grease, waxes, Vaseline – are essentially leftovers. If they were all eliminated, we’d still have to import the same amount of oil to make fuel for transportation. Electricity does not go into vehicles’ fuel tanks. And until we get lighter, cheaper batteries with much greater capacity, it never will.

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So Those Green Jobs Can’t Be Outsourced, Eh?



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You know, the jobs President Obama promises we’ll be world leaders in . . .

Maybe he means they’ll become our leading export.

From Benny Peiser:

International wind-turbine maker Vestas has announced that it will lay off 1900 employees including 600 in the UK. The news was well received by markets, with Vestas raising £700m in a Danish share issue the next day and announcing investments in Chinese plants. It’s a hell of a lot cheaper to make wind turbines in India or China, just like most manufactured goods. So forget about a glorious future of British windmill makers winning orders from around the globe.
   –Lewis Page, The Register, 29 April 2009

‘Cash for Clunkers’ Gets a Reality Check



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Democrats have spent this term in Green Neverland daydreaming about what cars automakers should build in order to save the planet and themselves. Detroit “must build the cars of the future” our president likes to say. But with Washington now finding itself an investor in the most complicated consumer-products business on the planet, politicians are being forced to face reality.

Take this week’s House effort to draft a “cash for clunkers” bill modeled after European “scrappage” incentives for consumers to trade in their old cars for new models, thus jump-starting dead car sales.

Loath to let a crisis go to waste, Democrats added green provisions to force consumers to consider only fuel-efficient cars. Two bills emerged from this process, with green groups favoring a proposal sponsored by Rep. Steve Israel (D., N.Y.) requiring that eligible cars for purchase get a whopping 25 percent more than current fuel mileage rules, or 34 mpg for cars and 28 mpg for trucks. (A competing bill from Rep. Betty Sutton (D., Ohio), supported by the Michigan delegation, would extend the deal to American cars only — a measure protested for its protectionist trade implications).

Well, hello, reality. While Congress fancies the idea that Americans crave small cars, they don’t. The number of vehicles that meet the Israel bill criteria is small — and they are small cars, so-called B or C-class cars like the Toyota Yaris or hybrids like the Toyota Prius. As a result, the bills would have discriminated against families that need larger vehicles and ultimately would have done little for Detroit because the mpg designation would bypass the D and E class segments which are the meat of auto sales. For example, Chrysler — the hardest-hit automaker — would have no vehicles qualify.

As a result, a compromise reportedly reached Wednesday between the two bills departs significantly from their original, green priorities. Charles Territo of the Alliance of Automobile Manufacturers says dryly: “Members of Congress are getting much more insight into the vehicles that consumers want.”

Gone are the hard ideological demands that a voucher worth $3,000 to $5,000 go only to small cars — replaced by rules that echo existing federal CAFE rules of 22.7 mpg for trucks 27.5 mpg for cars, averages that every major manufacturer meets.

Furthermore, Rep. Israel indicated that the standards would be soft, requiring the purchase of vehicles “at or near existing CAFE standards.” In other words, a loophole you can drive a Chrysler Town & Country minivan (21 mpg) or GMC Canyon Crew Cab pickup (21 mpg) through.

“It’s a disappointing compromise,” Israel said, trying to appease outraged green groups. “It isn’t exactly visionary.”

No, but it’s a nod to reality.

Low-Grade Arguments for Cap-n-trade



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I am reminded of one more note about that depressing spectacle at the Earth Day confab I have serially alluded to in this space. First, I read something today that aptly described the Waxman-Markey cap-and-trade plan — even sans most key details — as still being “intentionally complex.” Of course. It’s entire purpose is to hide the tax. Then there is the Daily Oklahoman’s editorial today (“The proposal . . . takes 648 pages to detail a system that would cap the amount of greenhouse gases companies can emit”) and Larry Kudlow’s comments (“huge, unwieldy tax”) over on the Corner.

 

This reminded me of how an NRDC co-panelist promoted cap-and-trade as the simple alternative to a direct tax, which he dismissed as too complicated. He suggested the audience consider how confusing their tax preparations had been just one week prior — well, that’s pretty much all you need to know about taxes, he ruled. Some argument. I suggested he take a look at how Europe’s scheme worked out, if he really wanted to see complicated.

                                                                                                                

I’ve noted how the rationers’ lead stab to promote cap-and-trade over the less inefficient, less costly tax, is the claim that it supposedly provides “certainty of emissions,” vs. a tax’s “certainty of cost” — even though Europe proved that any cap-and-trade scheme that can be enacted will have so many outs (“offsets,” and their cousin, the “safety valve”) that it brings no such thing. The closest thing to a “certainty” is that covered emissions will rise, until it’s just too costly to buy the offsets, at which point the covered emitters will leave.

 

My conclusion from all of this is that, if these are the best they can do in support of the thing, as it certainly seems is the case, you know it’s on a thin reed and likely won’t make it through a robust exposure to democracy (Europe’s scheme, as you know, was never subjected to such consideration).

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False-Peak Oil?



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Stephen J. Dubner on the Times’s Freakonomics blog:

It is always interesting to watch what happens when the media latches onto a given issue and then, as the reality on the ground evolves — sometimes radically — the media fails to catch up to, or even monitor, the changes. This means the public is stuck with an outdated version of conventional wisdom which, even if it were true in the first place, is no longer so.

With oil prices falling by more than two-thirds last year before a slight rebound, the “peak oil” frenzy seems to have abated for now. Even its proponents must admit that high oil prices were driven in large part by a huge spike in demand (which has now fallen) and not just scarcity (whether real or sinisterly implied by those who hold oil reserves).

But even though the hysteria has died down, new technologies march on, quietly changing the rules of the debate (if, that is, there still were a debate).

Consider, for instance, this fascinating article by Guy Chazan from the Wall Street Journal’s special report yesterday on energy. It’s called “Squeeze That Sponge.” Highlights:

Despite the engineering advances of the past century, nearly two-thirds of crude still gets left in the ground. So oil companies are raising the ante, investing billions of dollars in cutting-edge technology to increase the amount of crude they can tap. The potential rewards are huge: Raising the average recovery rate world-wide to 50 percent from 35 percent would boost the world’s recoverable oil by about 1.2 trillion barrels — equal to the whole of today’s proven reserves, the International Energy Agency says.

Such recovery measures aren’t pie-in-the-sky, either. Chazan’s article brims with specific examples; for instance:

One method of improving oil recovery could become a vital weapon against global warming: Some companies are pumping carbon dioxide into reservoirs to flush more oil out of the ground. The technique could become increasingly attractive as the world seeks to reduce greenhouse gases. Why not put the carbon dioxide to work, the thinking goes, rather than simply storing it in disused oil reservoirs, as is also done currently.

And:

BP is also experimenting with microbes that reduce the viscosity of heavy oil and help trapped oil move more freely. Another new technology: LoSal, a flooding technique that uses water with reduced salinity, unlike the salt water many oil companies use. BP has discovered that less salinity in the water can improve recovery rates.

This isn’t to say that oil is inexhaustible, nor that energy companies shouldn’t be pursuing more diverse and cleaner energy solutions. But they are. Consider two other articles in the Journal’s special section: this one on tidal and wave power and this one on ultra-high-voltage power lines, which can move electricity further and with less line loss than regular power lines.

So many contemporary debates about energy are lame because the issue is a) heavily politicized; and b) fraught with too many adjectives and not enough numbers. . . .

Read the rest here.

The Accidental Supporter



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I do a weekly hit on WIBC’s “Garrison” show — his “Grumpy Old Men Wednesday” cabinet stocked with the likes of me, Michael Ledeen, Jed Babbin, David Horowitz . . . grumps one and all. Greg, you might be interested to know, took over for the old Mike Pence Show.

And we are vexed with almost equal regularity by the congressional (particularly the Senate) representation of his state, which gets as much or more of its electricity from coal than any other state — about 95 percent — and which, according to a Heritage Foundation analysis, would boast eight of the top 20 House districts in terms of job loss from any cap-and-trade rationing.

So after today’s show I was pleased to see the following constituent response from Sen. Evan Bayh forwarded by a listener — Bayh having sworn in the past  that he would never do anything to harm his constituents on this front, while out of the other side of his mouth justifying his position on such anti-Hoosier legislation by claiming that he’s simply “following the lead of Indiana’s senior Senator” (Richard Lugar — a Kyotophile if ever there was one). Um, does that dodge apply to every issue and, if not, why just here?

Dear Mr. [Hoosier]:

Thank you for contacting me regarding the impacts of global climate change. I appreciate your thoughts and concerns on this issue. 

            I am deeply concerned about the threat posed by global climate change. The scientific consensus on this issue is unequivocal. Global warming is real and greenhouse gas emissions from human activity are causing it. Scientists and others warn that climate change threatens our nation’s security, and may imperil future generations’ opportunity for safe, healthy, and prosperous lives.

             However, any carbon-constraining mechanism must protect Hoosier ratepayers, workers and businesses from increased costs. Additionally, other nations of the world must be included in this effort, because if they are not, our action will be for naught. 

            Please rest assured, should legislation regarding global climate change be introduced in the 111th Congress, I will keep your views in mind.

         Again, thank you for contacting me.  I hope the information I have provided is helpful. My website,  http://bayh.senate.gov, can provide additional details about legislation and state projects, and you can also sign up to receive my monthly e-newsletter, The Bayh Bulletin, by clicking on the link at the top of my homepage.  I value your input and hope you will continue to keep me informed of the issues important to you.

Office of Senator Evan Bayh
(202) 224-5623
Russell 131
Washington, D.C. 20510

So here we see that — although Sen. Bayh naturally didn’t write this letter, which was queued up by the herd of Legislative Correspondents populating the back rooms of all such offices — he and his colleagues ought to have it glued to them wherever and whenever they utter comment on the issue, as the best way to make sure they really do keep such concerns in mind.

This isn’t just an exercise in saying a lot without saying anything, of having something both ways. No doubt, real, serious threat . . . but, uh, one that we’ll only address if it’s free.

Here’s a contest: is it the first half, the last half, or both halves of that utterly inane formulation that he doesn’t actually believe? (Plus, really, how long do we let politicians get away with vowing that, e.g., measures designed and intended to increase energy prices will, at all cost, not increase your energy prices? Folks, you only continue to be treated as children as long as you allow it.)

Note that Sen. Bayh does let slip one key acknowledgement: that any legislation that the U.S. passes, unless in implementation of an international deal that also requires actual reductions by India, China, Mexico, et al., will be for naught. All pain, no gain.

Thank you, Junior Senator, for taking the time to admit this — which, yes, will prove helpful. And please rest assured that we look forward to repeating this early and often, should the House ever risk repeating the BTU debacle and sending a similar bill over to the Senate for burial.

Catastrophic Climate Change



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Via Climate Depot: global warming responsible for . . . kitty fecundity.

Taxpayers, Taxpaying Customers, and Taxpayers



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Planet Gore reader Peter R. writes in to comment on my item below:

I love when the Greenpeacenik suggests that the cost of refitting every building in the U.S. with solar panels should be borne by a combination of government, business, and the taxpayers.

I guess she thinks those three entities all have separate pools of money to draw from, unrelated to one another.

Staring at the Sun Too Long?



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Look, I understand that enviros are generally rich people who feel so badly about their wealth that they want to make sure that others avoid the same fate, but this must be one really big house we’re talking about here (about two-and-a-half minutes in). Like, John Edwards-big.

And that is by no means inconsistent with your typical green activist. But we are told by Greenpeace’s “solutions director” that spending $37,000 to make one’s home run on solar power would pay for itself in six years.

Let’s forget about the time-value of money here for a moment — just so as to stay on the same page of “green economics” — and ask about the circumstances requiring someone to pay about $515 per month in home energy costs.

In Virginia, a rather large home for a family of four, including young children who require lots and lots of hot water and electricity to run a washer and dryer and dishwasher for hours on end pretty much daily, who eat in most nights, and who otherwise do not shy away from creature comforts, entails a monthly bill that is less than half of that for both gas and electric.

The background behind the Greenpeace rep in this clip suggests that the speaker is in California and, giving her the benefit of the doubt, let’s suppose that her anecdotal friend also lives in that state, known for its government interference that causes energy prices to “necessarily skyrocket” to the global warmists’ initial Target Level. It nonetheless would seem that Greenpeace’s problem solver has failed to convince her energy-intensive friend to walk the greens’ talk (outside of checking into the price of solar panels).

Someone please tell me how I’ve got this wrong. Do we have here yet another case of the greens’ fuzzy math? They have a habit of selling their agenda by promising that it will make us all rich — despite having quite the opposite effect wherever it has been tried.

But perhaps this Greenpeace woman is on the level. Still, if Californians pay twice as much as I do for home heating and cooling — in a mild climate requiring a fraction of such activities as are required throughout most of the country — and other home energy needs, then it only reaffirms that the only way to make wind and solar remotely economic is to skyrocket the cost of their competitors.

Mommy, Why Does President Obama Hate Polar Bears?



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From a Center of Biological Diversity press release:

WASHINGTON, D.C.– Utilizing authority granted to him by Congress, Interior Secretary Ken Salazar rescinded a rule passed in the final days of the Bush administration that weakens the Endangered Species Act by exempting thousands of federal activities, including those that generate greenhouse gases, from review under the Endangered Species Act. Salazar, however, did not take action to rescind a rule that sharply limits protections for the threatened polar bear despite having authority to rescind this rule as well.

The CHUcago Way



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If they bring a knife, you bring a million bucks.

Energy Secretary Chu is giving piles of taxpayer money to researchers at his old lab:

The Department of Energy will pay $30 million over five years to two professors at the University of California, Berkeley, for research on cleaning up power plant pollution.

Professors Berend Smit and Donald DePaolo will get $2 million and $4 million a year, respectively, to seek better ways to clean carbon out of the emissions from power plants and natural gas wells and to put it underground.

This “carbon capture and sequestration” technology will keep carbon dioxide out of the atmosphere, where it is believed to add to global warming.

Smit is a chemist and DePaolo is a geologist and head of the Earth Sciences unit at Lawrence Berkeley National Laboratory on the hill above U.C. Berkeley’s campus. . . .

Steven Chu, Obama’s energy secretary, was the director of Lawrence Berkeley Lab before being tapped for the DOE post.

Black(out) Humor



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I just got off a segment on Bernie Thompson’s radio show, blasting out of northwest Florida — where global warming cheerleading by rent-seekers such as the utility FPL has left the ratepayers worrying about the “wind gap.”

That is the phenomenon raised by a questioner on that odious Earth Day panel I mentioned last week, about how a national renewable-energy standard — pushed so hard by (surprise!) windmill and solar-panel companies that would not now exist had there not been government subsidies, mandates, and of course taxes to bring them about — would disadvantage rather windless states like Florida. In response to which the American Wind Energy Association representative casually remarked that it’s no problem, Floridians can pay for wind energy from as close as “eight states away.”

How easily that tolls off the tongue when it’s other peoples’ money you’re talking about (and trying to get the federal government to turn into your money). Whereas the idea of leaving such decisions to states that actually find it beneficial — as opposed to an inefficent, financial drain — is simply unacceptable.

So, in addition to the “wind gap,” Bernie let me in on other delightful turns of the phrase on the matter:

“We have to break our addiction to foreign wind,” and “How I learned to stop worrying and love the wind.”

The GOP and What Cap-and-trade ‘Would Cost’



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The Times makes room for Climate Wire today (though apparently not a proofreader):

“This is the largest assault on democracy and freedom in this country that I have ever experienced,” Rep. John Shimkus (R-Ill.) said at an Energy and Commerce Committee hearing last week, adding that he feared the cap-and-trade proposal [sic] more than the Iraq and Afghanistan wars, the Sept. 11, 2001, terrorist attacks and former President Clinton’s impeachment trial.

Earlier this month, House Minority Leader John Boehner (R-Ohio) on national television boldly questioned U.S. EPA’s decision to propose regulating carbon dioxide and other greenhouse gases, saying “the idea that carbon dioxide is a carcinogen that is harmful to our environment is almost comical.”

And former House Speaker Newt Gingrich (R-Ga.), who is flirting with his own 2012 presidential run, made the ultimate threat, saying President Obama could lose the White House over global warming. “If he signs a trillion-dollar tax increase, I suspect it’ll make it much harder for him to get re-elected because I think the economy would react to the tax increase,” Gingrich said last week.

Energy and Commerce Committee Republicans won a small victory yesterday, as Chairman Henry Waxman (D-Calif.) and Energy and Environment Subcommittee Chairman Ed Markey (D-Mass.) punted a markup to next week and agreed to an extra hearing Friday on their draft bill.

Meanwhile, Republicans are criticizing Democrats for not being more transparent. Waxman and Markey left blank the section on emission allowances, prompting the GOP to throw the kitchen sink at the majority for failing to disclose the full details of the bill and accusing Waxman of arm-twisting and using back-room secret deals to buy votes.

When the markups do come, Rep. Joe Barton (R-Texas), ranking member of the full committee, is promising “mass chaos.”

Government Motors’ Choice: Green Cars or Greenbacks?



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Should it happen, the General Motors/Treasury proposal to give majority control of America’s biggest automaker to the federal government would put Washington in the awkward position of being both owner and regulator.

“At some point,” says Michigan economist Pat Anderson, “Legislators would realize that the only way they can make the company profitable is by making cars they don’t like.”

The quickest way for government to nurse a nationalized GM back to health is by playing to its strengths of manufacturing big cars and trucks. But standing in the way are the government’s own egregious CAFE laws which will force automakers by 2020 to make a vehicle fleet that averages 35 mpg — a mandate that drives up production costs (an estimated $85 billion) at the same time it forces automakers to manufacture cars that customers don’t necessarily want. Other perverse clauses in fuel mileage laws include the “two-fleet” rule that requires small cars be built in the U.S. to satisfy UAW demands — even as such cars could easily be manufactured more profitably abroad.

Anderson believes this untenable conflict will ultimately convince Treasury that Washington’s equity share must be short-lived.

However, there is a second scenario — that Congress will try to have it both ways. In their determination that GM make the “right” products, Democrats will offer more aid, effectively handicapping GM competitors such as Ford that must make CAFE-compliant fleets without government help.

Anderson again predicts that reality will forestall this scenario: American taxpayers are already showing themselves to be impatient with auto bailouts, never mind an endless gravy train. Still, the rapidly mounting complications of federal involvement in the auto industry is a reminder of why Washington should never have crossed the Rubicon in the first place.

The Crushing Weight of My Predictive Powers



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Climate Depot turned me on to a Guardian story today that only adds to the burden placed on me by my inerring prescience.

The Obama administration is softening up its European counterparts to accept the fact that he will not sign up to Kyoto II at Copenhagen; apologists insist that this really, really is rather different than his GOP predecessor — whose stance (somehow) was also really, really quite different from his Democratic predecessor — and are falling over themselves to explain it away. The important role that Congress plays in all of this has been rediscovered (after eight long years of being the Republican executive’s doing). And — oh by the way — the administration is plotting a Plan B of circumventing the Constitution’s treaty requirement by simply waving a wand and declaring Kyoto II to be not a treaty but an executive agreement (misstated as “executive order” in the piece).

Sound familiar to Planet Gore readers? If the truth weren’t that the global-warming activists and their cheerleaders are so easy to figure out, I’d say it’s time to go to Vegas and make profitable use of these prodigious prognosticatory powers, but our president has told us that’s a bad idea. I might end up using energy — like, say, some absurd Earth Day gesture or Air Force One boondoggle.

Green Jobs Exploding!



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Watts Up With That has a nice post on the implosion — and explosion — of green jobs.

Bring Back Bourbon



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In case you missed it yesterday, the Wall Street Journal (subscription required) has even more bad news for the U.S. corn-ethanol industry:

California’s decision to adopt new-vehicle fuel standards to reduce greenhouse-gas emissions will have little short-term impact on corn-ethanol demand, but in the long term it is seen hurting the biofuel.

The state’s Air Resources Board approved the measure by a 9-1 vote Thursday. The regulation will require a lower “carbon intensity” in fuels starting in 2011.

It also includes land-use changes due to ethanol production in assessments of ethanol’s carbon intensity, a facet of the rule fiercely opposed by the ethanol industry.

The change would mean that emissions stemming from crop production, including the destruction of forestland or pasture to make way for crops, would be added to ethanol’s carbon footprint.

The decision is a long-term roadblock that indicates “less of a bright future for corn-based ethanol,” said Michael Swanson, agricultural economist with Wells Fargo.

“We went from having endless ethanol growth to having: ‘hmm, what kind of future do we have there anyway?’” Mr. Swanson said.

The ethanol market has broader economic concerns, analysts said. Chad Henderson, analyst for Prime Ag Consultants, said that corn traders see ethanol demand as more politically motivated than economically driven.

He said he isn’t anti-ethanol or pro-ethanol, “but at some point down the road, you would think ethanol needs to stand on its own two feet economically.”

Mr. Swanson said that main problems facing ethanol are weak demand and improved fuel efficiency, which could cause a cut in ethanol demand even as it increases market share. He said there is little bullish news emerging from the ethanol market for corn traders.

Al Gore’s Inconvenient Enron



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This is a worthy topic for continued congressional exploration. In short, the video and accompanying narrative dissect Al Gore’s Friday Capitol Hill appearance touting a scheme to ration energy while in the process rewarding those businesses who helped concoct the scheme:

Al Gore obfuscates, downplays and refuses to discuss the role that CEOs have played in crafting his Cap-and-Trade C02 trading schemes and carbon swapping systems.

Al Gore tries to put a lid in Congressional committee testimony on a little reported but vitally important subject in the global warming, carbon-tax ‘debate’ — the new derivatives bubble in the emerging green-energy credit-swap market. . . .

The point from Rep. Scalise that is gaveled over by the chairman and stuttered-over by Gore is that many of the Congressmen are ‘concerned about turning over our energy economy over to firms like Enron and some of these Wall Street firms that wrecked out financial economy.’

Fmr. Vice President Al Gore denies that Ken Lay and other CEOs developed carbon scheme: “I didn’t know him well enough to call him ‘Kenny-boy’.

Of course, Gore wasn’t the home-state governor of this Fortune 15 company either, so I guess his supposed lack of familiarity (keep reading) would make sense. But one might ask what nickname Gore had for close family friend and (ahem) benefactor, the Soviet stooge Armand Hammer? Maurice Strong? The gang at his own personal Enron — scam-artist and buddy-run Molten Metals? Et cetera, et cetera…

 

Here, we see how Gore lapses into his true self, well-known before adoption of this Right Reverend persona, awkwardly trying to change the subject from something that is rightly discomfiting to him. So allow me to address the point, as there is much, much more to the story.

 

Twelve years ago almost to this very day, I left my law firm to accept a position that had rather unexpectedly fallen in my lap: I had gotten a call from Enron asking me to be their Director of Federal Government Relations. Everyone polled suggested it was a great opportunity, a company admired throughout town, not only by the Clinton-Gore administration (with which it was very close), but by Republicans, too.

 

I believe it was my first day on the job when I walked into my boss’s office in Enron’s suite across from the White House, smack into a meeting between her and two of the Natural Resources Defense Council’s senior DC officials. The next day, I sat in for “Kenny Boy” at a meeting in the fancy D.C. offices of a New York law firm, around a table of Baptists and bootleggers, rent-seekers and green puritans, all discussing how to ensure a global-warming treaty came about according to our collective design, and how to rope the U.S. into it.

 

Seeing very measured groups like the Union of Concerned Scientists on my immediate left (naturally), I turned to a representative of one of the rent-seekers (in on the meeting were the American Gas Association, Niagara-Mohawk Power, and BP, among others) on my right and asked, “What are we doing sitting around a table with a bunch of people who want to put us out of business?” I was told with a laugh, “They want to put coal out of business first.”

 

Lovely people, these folks kind enough to introduce me to the world’s second-oldest profession — making one’s fortune off of policy favors from buddies in government instead of by innovation or competition. Frederic Bastiat, phone your office.

 

So I fired off a “Houston, we have a problem” missive to my boss asking if Enron knew what it was getting into in this group. That’s when they explained the specifics of their business plan to me — which did include setting up a trading business with Goldman, by the way, as one of Goldman’s energy practice chiefs at the time also roared to me in joy about about all of the money they were going to make. This cannot conceivably be news to Al Gore and his VC partner and former Goldman pooh-bah David Blood discussed in the linked item above.

 

This plan has since been carried off to greener pastures by any number of Kenny Boy’s protégés — including one of the most vocal leaders of the current industry push for the cap-and-trade rationing scheme, as I detail in Red Hot Lies. Read that if you want to know just how Rep. Scalise really did nail things in his questioning.

 

Anyway, fast forward a few uncomfortable weeks of retaliatory behavior that I am confident you wouldn’t believe — but I’d be happy to take a speaking fee to tell you about. I’m no longer with the company, and Enron and the greens continue to pursue their agenda — which happens to be Congress’s current agenda. Soon thereafter, in July 1997, a unanimous Senate votes pursuant to Art. II, Sec. 2, gives its (unsolicited) “advice” to Clinton-Gore not to go to Kyoto and agree to that beast of a treaty. In December, Al Gore flies off to Kyoto and does just that.

 

The intervening event? An August 4, 1997 Oval Office meeting with Kenny Boy, Sir John Browne (then of BP), and the president and vice president of the United States. Let that sink in. Al Gore says he didn’t know the guy. But anyone who can even spell “Beltway” can tell you that that kind of attention requires serious influence. Ask Gordon Brown.

 

As revealed by the August 1, 1997, Kenny Boy briefing memo that entered the public record after the Enron unpleasantness, in this meeting Kenny Boy was to demand that the Senate be ignored, that the administration agree to Kyoto, and — most important — that it contain a cap-and-trade scheme.

 

I know where “advice and consent” is in the Constitution. I’m not so sure where Ken Lay and Sir John Browne are, probably in the back with all of the scary stuff. Anyway, you know who won.

 

So, in tossing things back to Gore to finally answer the question, I leave you with key excerpts from the “what I did in Kyoto” memo by Lay’s Kyoto aide (yep, he had one), John Palmissano, hailing Enron’s success:

  • “This treaty [Kyoto] is exactly what I have been lobbying for.”
  • “This agreement will be good for Enron stock!!”
  • “Enron now has excellent credentials with many ‘green’ interests including Greenpeace, [World Wildlife Fund], [Natural Resources Defense Council], German Watch, the U.S. Climate Action Network, the European Climate Action Network, Ozone Action, WRI . . . ”
  • “This position should be increasingly cultivated and capitalized on (monitized) [sic].”
  • “if implemented, this agreement will do more to promote Enron’s business than will almost any other regulatory initiative outside of restructuring of the energy and natural gas industries in Europe and the United States.”

Don’t Expect a ‘Smart Grid’ in the Near Future



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Today’s Baltimore Sun has a good piece on the daunting challenge of moving the United States to the “Smart Gird.” An excerpt:

The Electric Power Research Institute has estimated the cost of building a smart grid at a staggering $165 billion — about $8 billion a year for two decades.

And one of the biggest challenges in rolling out a smart grid, energy experts say, is getting hundreds of industries, from power generators to appliance and auto manufacturers, to agree on a set of standards — some already developed, many not ready yet.

Talk of complex standards may not sound as appealing as an in-home “smart meter,” displaying the energy that a refrigerator uses or how much of it is powered by a nearby solar farm. Yet without standards, that smart meter is just another “dumb” appliance.

“If you look at how vast the grid is, all the way from generator to consumer, to bring together a communication fabric so that information can be exchanged, will take four to five years, easy,” said Arshad Mansoor, vice president of power delivery and utilization at the Electric Power Research Institute, a utility industry think tank.

Hired by the National Institute of Standards and Technology to develop a road map of standards and find a consensus on a plan, Mansoor’s group will help the institute, Secretary Chu and Commerce Secretary Gary Locke jump-start the process in early May.

The potential problems are daunting: “It will be a mess,” Mansoor says, if auto manufacturers each come up with a unique standard for how plug-in hybrid technology will communicate with the smart grid – reminiscent of the “VHS vs. Beta-max war” of the early 1980s. To avoid that, the electric utility industry is working with automotive engineers to develop plug-in standards.

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