Some thoughts about secular stagnation | 107 comments (107 topical, editorial, 0 hidden)

Re: use savings glut to finance public investment (4.00 / 2)

A quick look at askod's graph leads me to ask: where is Germany to find relief? While I am sure that Powder Basin coal miners and US railroads are more than happy to sell Germany coal, but it is unlikely to be a very good deal. As capital costs are retired and wind power continues to decline in price it will have tremendous advantages over coal, even before considering the carbon. There is no fuel costs for renewables. And then there is the reaction of the German people.

I will await the response of Crazy Horse, DoDo or Jerome for a better answer. But I remain suspicious of anything the WSJ might have to say about energy. It does seem that the cost of energy for manufacturing, as opposed to residential uses is posing a problem in Germany and industry, in conjunction with Merkel's conservative government, when it emerges, could do damage to Germany's world leading wind energy manufacturing industry. But where else can Germany get affordable power. Wind is roughly competitive with coal in the USA now, and doesn't have to include the cost of sea shipment, but no new coal plants are being built. This indicates that the issue is not based on the fundamental costs of the two sources so much as on who gets subsidized by whom.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Nov 20th, 2013 at 08:21:44 PM EST
[ Parent ]

Re: use savings glut to finance public investment (none / 0)

I guess the biggest take-away for me ― not only from the WSJ, but from Phys.org and AlphaGalileo ― is that "German emissions increased 1.8 per cent in 2012, with coal growing at 4.2 per cent".

It sounds like you think this is a temporary phenomenon and in the long run carbon emissions will go down as renewable power becomes more competitive and thus widespread in Germany.

Point n'est besoin d'espérer pour entreprendre, ni de réussir pour persévérer. - Charles le Téméraire

by marco on Thu Nov 21st, 2013 at 09:16:32 PM EST
[ Parent ]

Re: use savings glut to finance public investment (none / 0)

It sounds like you think this is a temporary phenomenon...

That depends on whether energy incumbents in Germany can combine with industry wanting cheap power to kill the German wind energy business. Stay tuned.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Nov 22nd, 2013 at 12:24:15 AM EST
[ Parent ]

Re: use savings glut to finance public investment (none / 1)

You need to be a little careful with the electricity portfolios of small European countries (and in the context of electricity, the only not-small European country is Russia). Europe has a lot of cross-border load balancing, with France a major buyer of intermediate load, and Germany a major supplier. Since intermediate load is typically more CO₂-intensive than base- and peak load, part of the German increase is probably attributable to increases in other parts of Europe (conversely, the French boast that their all-nuke strategy is carbon-neutral is... not totally true).

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Fri Nov 22nd, 2013 at 04:11:47 AM EST
[ Parent ]

Re: use savings glut to finance public investment (none / 0)

part of the German increase is probably attributable to increases in other parts of Europe (conversely, the French boast that their all-nuke strategy is carbon-neutral is... not totally true).

How much is attributable to that, and how much is attributable to burning coal imported from the USA. There must be figures for that somewhere.

Let's talk about energy. You say alternative energy can't scale. Is there no role for renewables?
I like renewables, but they move slowly. There's an inherent inertia, a slowness in energy transitions. It would be easier if we were still consuming 66,615 kilowatt-hours per capita, as in 1950. But in 1950 few people had air-conditioning. We're a society that demands electricity 24/7. This is very difficult with sun and wind.
Look at Germany, where they heavily subsidize renewable energy. When there's no wind or sun, they boost up their old coal-fired power plants. The result: Germany has massively increased coal imports from the US, and German greenhouse gas emissions have been increasing, from 917 million metric tons in 2011 to 931 million in 2012, because they're burning American coal. It's totally zany!
― Vaclav Smil quoted in This Is the Man Bill Gates Thinks You Absolutely Should Be Reading, Wired

Point n'est besoin d'espérer pour entreprendre, ni de réussir pour persévérer. - Charles le Téméraire

by marco on Mon Nov 25th, 2013 at 03:58:14 PM EST
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Re: use savings glut to finance public investment (none / 1)

Energy transitions are slow because we are sitting with our thumbs up our asses and waiting for them to happen automagically, instead of devoting an actually meaningful share of the gross planetary product to making it happen.

Pissing around with a few hundred billion here and there just isn't gonna cut it.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Nov 25th, 2013 at 06:02:23 PM EST
[ Parent ]

Re: use savings glut to finance public investment (none / 1)

This article argues that the increase in coal is a short-term "bump" in the road, with three primary reasons:

... The increased coal burn that has occurred (and it has) comes from existing units. But this is due to short term economic factors, not a long term revival of coal's economics (which are terrible). In the EU, coal use has been growing since 2009 (after a steep drop in the preceding two years) but it is still below 2007 levels and well below increases in renewable energy generation.

There's a lot of reasons for this short-term bump. The most important are: 1) strict new air pollution rules that ensure a huge amount of coal-fired capacity will be retired or constrained by 2016; 2) rock-bottom carbon prices; and 3) national level coal policies. But some of these same factors will conspire to have the exact opposite effect in the long run. ...
"Europe's 'Coal Renaissance' Masks Industry Downfall"
by Justin Guay, Washington Representative, Sierra Club

Point n'est besoin d'espérer pour entreprendre, ni de réussir pour persévérer. - Charles le Téméraire

by marco on Tue Nov 26th, 2013 at 01:31:54 AM EST
[ Parent ]

Re: use savings glut to finance public investment (none / 0)

"1) strict new air pollution rules that ensure a huge amount of coal-fired capacity will be retired or constrained by 2016"

Here in the UK, the usual opinion among energy consultants (those I've spoken to, at any rate) is that these rules will be ignored and the plants will stay online.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Tue Nov 26th, 2013 at 02:51:17 AM EST
[ Parent ]

Re: use savings glut to finance public investment (none / 0)

The easiest solution would be to produce the power outside Germany, in places where the climatic/political conditions are more amenable to it, and then run HVDC lines.

Clean Options, alphabetical:

Advanced nuclear : Build molten salt reactors in the Czech republic, France. (these are two of the nations with the most actual, current, research into this)

Boring nuclear: Same, but with PWR's.

Renewable: Solar: Longer HVDC lines. Into north africa. Lots, and lots of solar. Mostly this gets you increased reliability and removes the "winter" problem.

Renewable: Wind: North sea floating windmills, produced shipyard style. Domestically, build http://eduard-heindl.de/energy-storage/energy-storage-system.html to level out supply.

by Thomas on Mon Nov 25th, 2013 at 10:04:35 AM EST
[ Parent ]

Re: use savings glut to finance public investment (none / 0)

Call me irrational and/or simple-minded, but after Fukushima, I am completely anti-nuclear.

At the top of your list, I would add two options:

reduction in consumption
efficiency (e.g. better insulation)

Passivhaus construction -- which is even spreading to China now -- is in line with these two.

Point n'est besoin d'espérer pour entreprendre, ni de réussir pour persévérer. - Charles le Téméraire

by marco on Mon Nov 25th, 2013 at 04:04:42 PM EST
[ Parent ]

Re: use savings glut to finance public investment (4.00 / 2)

Reductions in overall electricity consumption are not going to happen.
Cleaning up the rest of the economy - transport, chemical and industrial processes currently run of fossil inputs and so on means that the grid is going to have to supply a lot more juice. Currently electricity is roughly a third of our energy use, in a zero-emission economy, it will be well north of ninety, with the remainder being things like food production waste based fuels for niche applications and ambient heat sucked in by heat pumps. So even large efficiency gains still imply electricity production that is overall quite a lot higher than at present.
So production plans need to be scaled for that, and the main point of efficiency gains is to limit just how much additional cabling you are going to have to bury.

by Thomas on Mon Nov 25th, 2013 at 04:20:28 PM EST
[ Parent ]

Re: use savings glut to finance public investment (none / 1)

Some of the extra consumption isn't actually going to impact the last-mile grid too badly. If we go down the path of "all electric motoring, and all electric home-heating via heatpumps" (you cant do district heating off a windmill.) then that demand can all be time-shifted trivially, so existing wiring out to residences would need only modest upgrades. But the production side? That is going to need beefing up. A lot.

by Thomas on Mon Nov 25th, 2013 at 04:38:01 PM EST
[ Parent ]

Re: use savings glut to finance public investment (4.00 / 2)

You're irrational and/or simple-minded.

Like me.

by afew (afew(a in a circle)eurotrib_dot_com) on Mon Nov 25th, 2013 at 04:21:10 PM EST
[ Parent ]

Some thoughts about secular stagnation | 107 comments (107 topical, 0 editorial, 0 hidden)

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