Dictionary definitions of Science are "a particular branch of scientific knowledge", or alternatively, "ability to produce solutions in some problem domain". The word science originates from the Latin scientia, the meaning of which is "knowledge". In turn, knowledge is defined as "the psychological result of perception, learning and reasoning".
In other words, science is as often as not subjective, an adjective defined as "taking place within the mind and modified by individual bias".
Science, which to the individual scientist tends to be indisputable truth, has throughout history been hotly debated among opposing factions of dogmatists, often in less than polite terms and at times with fatal personal consequences to anyone expressing disagreement with generally held opinions. Not much original scientific dogma has survived intact. Were it so the Earth would still be flat and there would not be much sense in continued scientific research in fields already resting on generally accepted scientific opinion.
Research nevertheless continues to be undertaken, for which we have to give thanks lest momentarily accepted "knowledge" takes permanent hold. However, researchers need funding to put food on the table and offspring through college, and entities or persons putting up the money not infrequently do so to elicit scientific support for their own opinions or vested interests in the subject at hand. Human nature being what it is, this should not come as a surprise.
Climate change, and the role of anthropogenic carbon dioxide emissions into Earth's atmosphere, is one current area of particularly intense and high-stake disputation. It was recently revealed that a certain academic, who happens to disagree with the majority opinion that atmospheric carbon dioxide concentrations are prime movers of global warming, had been funded by industry groups with economic interests at stake.
If I may be so bold as to ask, where else do we imagine this particular academic would obtain funding for his alleged heresies against "the declared findings of 97% of the world's climate scientists"?
Let us not be so naive as to think that the funders of that 97% - mostly national and multinational governmental institutions and NGOs - do not have personal or collective axes to grind in return for the monies they bestow on their set of researchers. We can expect equal amounts of preconceived bias on both sides of the table. That is after all what debating is all about.
Unfortunately, if there are areas where "scientia" should be treated with a dose of scepticism, climate change causations are high on the list. Fundamental changes in Earth's climate is a macro-millenial process, much of which is not well understood, or understood at all. By lucky coincidence, Earth's climate has been uncharacteristically benign and stable during the latest 12,000 years, the period when homo sapiens set out on the social and economic evolution towards where we find ourselves today. If Earth's past climate history is anything to go by, we can be pretty sure that the climate will in time again become a lot less amenable, almost certainly too cold rather than too hot.
Personally, I am all for finding viable long term energy and raw material alternatives to fossil fuels as soon as possible, but I would recommend we change our focus on the issue from disputable climate science to the undisputable fact that fossil fuels will one day be exhausted.
Wednesday, March 11, 2015
Tuesday, August 19, 2014
MEDIAN HOUSEHOLD INCOME
On its own merit, I find median household income one of the more useless statistical concepts out there.
Median simply means that of 115,226,802 U.S. households (2012), 57,613,401 households had incomes below a yearly median of $ 51,371 and 57,613,401 households had income above the median. So what?
Dig a little deeper, and you will find that the average 2012 household income was $ 71,247, close to 40% above the median. Now a couple of relevant facts come to light. The first is that total annual household income was $ 71,247 x 115,226,802 households = $ 8.2 trillion. The second is that the poorest half of the households - the left leg of the statistical median bell curve - earns significantly less than those on the right bell curve leg, and very significantly less than the tail end of the right hand leg.
In 2012 total household debt in relation to household income - mortgages, student loans, car loans, credit card debt, etc. - was about 90%. Add that multiplier to total household income of $ 8.2 trillion and what do we get? U.S. Gross Domestic Product (GDP) of $ 15,7 trillion.
Simplistic, but relevant. At the end of the day it all comes down to household income plus how much households reasonably can and will borrow for consumption and private investment. In recent past household borrowing grew unsustainably to well over 100% of income, precipitating the 2008 financial crisis.
We must of course add business and government investment into the GDP formula, but where do business and government get their income from? Businesses from selling goods and services to households, government from taxing households and businesses (which, as noted, get their taxable earnings from household income).
And that brings me around to the question of inequality of income distribution - the unbalanced two legs of the median bell curve. This inequality is commonly expressed with the help of the so-called Gini Index, which measures the degree of inequality in distribution of family income in a country. A coefficient of 100.0 would mean that a single family receives all income, while a coefficient of 0.0 would mean that all families earn exactly the same.
The Gini Index of the United States has been climbing relentlessly and without pause from 0.35 in the late 1960s. It is now 0.45, registering by a wide margin the highest family income inequality among all developed nations. It outdoes in income inequality terms countries such as Nigeria, the Ivory Coast and Turkmenistan, just to mention three. On the other hand, it may not come as a surprise to find the world's lowest income inequality among the Scandinavian countires, which come in at an average 24.3 on the Gini scale.
Now, is it not the rich that make the economy go around, the supply-side job creators of trickle-down economics? I beg to differ. Where there is demand - i.e., purchasing power - there will be supply and consequently the prospects of economic progress. Not the other way around - businesses do not invest where demand for their output is stagnant or absent. Since the 1960s U.S. economic growth trends have inversely mirrored the Gini Index progression. I do not consider this to be a coincidence.
When family income surpasses a certain level, consumption and private investment ceases and surplus income gets more or less idly hoarded. The very rich simply have more money than they know what to do with, at which point they cease to be propellants of economic growth. And that income level of more than enough really is not all that high. Not in the millions of dollars, and certainly not in the billions.
As a Scandinavian I am fully aware of the fact that the socio-economic philosophy of that part of the world is not in the American DNA. All I therefore wish to suggest is that beefing up the earnings power on the left leg of the median bell curve and reversing the Gini Index trend line would significantly boost the prospects for long term U.S. economic growth.
Maybe Henry Ford - no bleeding-heart socialist - could serve as an example for the way forward. In 1914 he more than doubled the wage level of his workers to $ 5 per day, on the premise that he needed popular purchasing power for all the cars he would be turning out on his revolutionary assembly lines.
This lucid move helped kick-start the birth of the American middle class, now on the endangered species list.
Median simply means that of 115,226,802 U.S. households (2012), 57,613,401 households had incomes below a yearly median of $ 51,371 and 57,613,401 households had income above the median. So what?
Dig a little deeper, and you will find that the average 2012 household income was $ 71,247, close to 40% above the median. Now a couple of relevant facts come to light. The first is that total annual household income was $ 71,247 x 115,226,802 households = $ 8.2 trillion. The second is that the poorest half of the households - the left leg of the statistical median bell curve - earns significantly less than those on the right bell curve leg, and very significantly less than the tail end of the right hand leg.
In 2012 total household debt in relation to household income - mortgages, student loans, car loans, credit card debt, etc. - was about 90%. Add that multiplier to total household income of $ 8.2 trillion and what do we get? U.S. Gross Domestic Product (GDP) of $ 15,7 trillion.
Simplistic, but relevant. At the end of the day it all comes down to household income plus how much households reasonably can and will borrow for consumption and private investment. In recent past household borrowing grew unsustainably to well over 100% of income, precipitating the 2008 financial crisis.
We must of course add business and government investment into the GDP formula, but where do business and government get their income from? Businesses from selling goods and services to households, government from taxing households and businesses (which, as noted, get their taxable earnings from household income).
And that brings me around to the question of inequality of income distribution - the unbalanced two legs of the median bell curve. This inequality is commonly expressed with the help of the so-called Gini Index, which measures the degree of inequality in distribution of family income in a country. A coefficient of 100.0 would mean that a single family receives all income, while a coefficient of 0.0 would mean that all families earn exactly the same.
The Gini Index of the United States has been climbing relentlessly and without pause from 0.35 in the late 1960s. It is now 0.45, registering by a wide margin the highest family income inequality among all developed nations. It outdoes in income inequality terms countries such as Nigeria, the Ivory Coast and Turkmenistan, just to mention three. On the other hand, it may not come as a surprise to find the world's lowest income inequality among the Scandinavian countires, which come in at an average 24.3 on the Gini scale.
Now, is it not the rich that make the economy go around, the supply-side job creators of trickle-down economics? I beg to differ. Where there is demand - i.e., purchasing power - there will be supply and consequently the prospects of economic progress. Not the other way around - businesses do not invest where demand for their output is stagnant or absent. Since the 1960s U.S. economic growth trends have inversely mirrored the Gini Index progression. I do not consider this to be a coincidence.
When family income surpasses a certain level, consumption and private investment ceases and surplus income gets more or less idly hoarded. The very rich simply have more money than they know what to do with, at which point they cease to be propellants of economic growth. And that income level of more than enough really is not all that high. Not in the millions of dollars, and certainly not in the billions.
As a Scandinavian I am fully aware of the fact that the socio-economic philosophy of that part of the world is not in the American DNA. All I therefore wish to suggest is that beefing up the earnings power on the left leg of the median bell curve and reversing the Gini Index trend line would significantly boost the prospects for long term U.S. economic growth.
Maybe Henry Ford - no bleeding-heart socialist - could serve as an example for the way forward. In 1914 he more than doubled the wage level of his workers to $ 5 per day, on the premise that he needed popular purchasing power for all the cars he would be turning out on his revolutionary assembly lines.
This lucid move helped kick-start the birth of the American middle class, now on the endangered species list.
Monday, June 16, 2014
Will the Euro Survive?
The short answer is: I believe, it will not.
On the eve of the euro's introduction on January 01, 2001, the British newspaper, The Guardian, wrote:
"If the euro is to prove successful, history suggests that political ramifications will be significant."
Quotes from the British economist Dr. Gerard Lyons on the subject are also enlightening:
"The European Monetary Union (EMU) will need to become a political union to survive. This is one of the lessons from a historical analysis of monetary unions in the nineteenth and twentieth centuries. Monetary unions of large sovereign nations which do not have polical union eventually fail, sometimes after a long time."
"The lesson is that monetary unions of politically independent, large sovereign nations can fail, particiularly when there is an external shock, causing the economic environment to change. It is easier for unions to survive when the economic cycle is favorable."
Well, you may argue, the Brits have always been biased against the euro. They are just sore losers, hankering for the days of glorly when the British pound ruled world trade.
That could be so, but I believe they have got their facts right about monetary unions.
Indeed, things seemed to be moving merrily along until the economic environment took a sharp turn for the worse towards the end of the EMU's first decade. When one looks at the European Monetary Union in the aggregate, it does indeed look pretty good. With a joint GDP of around 18 trillion dollars, it runs a positive current account balance of about 1%. Look a little closer, however, and you will discover some serious structural fault lines which have been there all along but conveniently overlooked, only to crack wide open during the economic and financial crisis which ensued.
To wit, while Germany runs a current account surplus of some 210 billion dollars, France, Italy and Spain, in the aggregate, run a deficit of around 110 billion dollars. Nested within a full political union - like for example the United States of America - there would be no problem. But the prospects of a United States of Europe have never been further off the political map than after the recent elections to the European parliament.
While Germany lectures its EMU partners to get their act together, it refuses to share the spoils from its own benefits of the euro. Just imagine where the exchange rate of the German mark would have been today, not the least in relation to where the French franc, the Italian lira and the Spanish peseta would have been. The mutual current account pictures would have looked a lot different, and banks would not be lending money in abandon to the weaker currency nations without a hefty interest premium tacked on,
Now that the damage has been done, it is simply impossible for the large sovereign deficit nations to get their house in order without being releasted from the shackles of the euro.
Sooner or later, the EMU will be history.
On the eve of the euro's introduction on January 01, 2001, the British newspaper, The Guardian, wrote:
"If the euro is to prove successful, history suggests that political ramifications will be significant."
Quotes from the British economist Dr. Gerard Lyons on the subject are also enlightening:
"The European Monetary Union (EMU) will need to become a political union to survive. This is one of the lessons from a historical analysis of monetary unions in the nineteenth and twentieth centuries. Monetary unions of large sovereign nations which do not have polical union eventually fail, sometimes after a long time."
"The lesson is that monetary unions of politically independent, large sovereign nations can fail, particiularly when there is an external shock, causing the economic environment to change. It is easier for unions to survive when the economic cycle is favorable."
Well, you may argue, the Brits have always been biased against the euro. They are just sore losers, hankering for the days of glorly when the British pound ruled world trade.
That could be so, but I believe they have got their facts right about monetary unions.
Indeed, things seemed to be moving merrily along until the economic environment took a sharp turn for the worse towards the end of the EMU's first decade. When one looks at the European Monetary Union in the aggregate, it does indeed look pretty good. With a joint GDP of around 18 trillion dollars, it runs a positive current account balance of about 1%. Look a little closer, however, and you will discover some serious structural fault lines which have been there all along but conveniently overlooked, only to crack wide open during the economic and financial crisis which ensued.
To wit, while Germany runs a current account surplus of some 210 billion dollars, France, Italy and Spain, in the aggregate, run a deficit of around 110 billion dollars. Nested within a full political union - like for example the United States of America - there would be no problem. But the prospects of a United States of Europe have never been further off the political map than after the recent elections to the European parliament.
While Germany lectures its EMU partners to get their act together, it refuses to share the spoils from its own benefits of the euro. Just imagine where the exchange rate of the German mark would have been today, not the least in relation to where the French franc, the Italian lira and the Spanish peseta would have been. The mutual current account pictures would have looked a lot different, and banks would not be lending money in abandon to the weaker currency nations without a hefty interest premium tacked on,
Now that the damage has been done, it is simply impossible for the large sovereign deficit nations to get their house in order without being releasted from the shackles of the euro.
Sooner or later, the EMU will be history.
Sunday, May 25, 2014
Russia's Natural Gas Deal with China in Perspective
After years of haggling, a long term deal for Russia to sell natural gas to China was finally announced during President Putin's recent state visit to China, involving up to 38 billion cubic meters per year over a 30 year period starting in 2018, at a total estimated sales value of 400 billion dollars. To complete this transaction, Russia will need to invest 55 billion dollars in pipelines to the border with China, which in turn will need to make pipeline investments on its side.
Russia exports annually about 200 billion cubic meters of natural gas, three-fourths of which to customers in Western Europe. The country has been eager to lessen its dependence on Western markets, not the least now that regional relations are less than warm after Putin's Crimean and Ucrainean escapades.
There are reasons to believe that this may not be such a sweet long term deal for Russia as may first meet the eye. Here is why.
Start with the caveat "up to 38 billion cubic meters". Then let us have a look at how important or not this whole deal may be to China.
The natural gas involved is presumably destined for production of electricity, as China is in desperate need to reduce air pollution from coal-fired generating plants. China's current annual electricity consumption is around 5.5 trillion kWh, and by 2018 it is likely to have reached 7.5 trillion kWh.
38 billion m3 of natural gas is sufficient to produce some 200 billion kWh of electricity, which by 2018 will most likely represent less than 3% of China's total consumption.
In other words, we are looking at a big deal for Russia but an inconsequential one for China. This kind of inbalance is often a recipe for trouble down the line. Guess for whom?
Russia exports annually about 200 billion cubic meters of natural gas, three-fourths of which to customers in Western Europe. The country has been eager to lessen its dependence on Western markets, not the least now that regional relations are less than warm after Putin's Crimean and Ucrainean escapades.
There are reasons to believe that this may not be such a sweet long term deal for Russia as may first meet the eye. Here is why.
Start with the caveat "up to 38 billion cubic meters". Then let us have a look at how important or not this whole deal may be to China.
The natural gas involved is presumably destined for production of electricity, as China is in desperate need to reduce air pollution from coal-fired generating plants. China's current annual electricity consumption is around 5.5 trillion kWh, and by 2018 it is likely to have reached 7.5 trillion kWh.
38 billion m3 of natural gas is sufficient to produce some 200 billion kWh of electricity, which by 2018 will most likely represent less than 3% of China's total consumption.
In other words, we are looking at a big deal for Russia but an inconsequential one for China. This kind of inbalance is often a recipe for trouble down the line. Guess for whom?
Thursday, May 8, 2014
ALL ABOARD FLORIDA
Florida East Coast Railways (FEC) operates rail freight services on 351 miles of track between Miami and Jacksonville. It is a highly indebted company with interest expenses, except for 2013, exceeding its operating income in every year since 2009. The company's equity ratio to total assets was a low 23% in 2009, and an even lower 18% in 2013.
In addition to its core freight business, FEC aims to initiate a high speed passenger rail service between Miami, Fort Lauderdale, West Palm Beach and Orlando on its own right-of-way between Miami and Cocoa Beach, and from there on 40 miles of new track to be built to Orlando International Airport. In addition to several bridges along the way which need regularly to be opened for boat traffic, there are 350 high volume grade road crossings along the way, 114 of which in Palm Beach county alone. FEC plans to operate 16 trains offering a 3-hours transit time between Miami and Orlando with hourly departures in each direction, reportedly counting on three million passengers per year yielding operating revenue of $ 145 million. This works out to about $ 0.15 per passenger-mile. In 2012 the project was said to cost $ 1.0 billion, an amount currently stated to be $ 1.5 billion, still not unlikely to being seriously under-estimated.
It is my opinion that FEC and its financial backers would do well in reconsidering this venture.
A lot can be said against the technical practicality and safety issues of such a service on FEC tracks. For starters, high speed rail traffic in other parts of the world are fenced off over the entire length of the track and do not coexist with grade road crossings. As I understand it, FEC has no plans to invest in changing status quo in this respect. But before getting too worked up about these issues, I believe it to be relevant first to have a closer look at the economic fundamentals of the venture on the basis of well established data from the operation of high speed rail services in Europe.
Looking at 15 major European high speed rail services - which by chance work out to an average travel distance close to the one envisioned between Miami and Orlando - ticket prices average $ 0.40 per passenger-mile. Only a single one of these services, the one between Paris and Lyon, manages to exceed operating and capital costs. All the others lose money and are dependent on large tax-payer subsidies to stay in business.
We will understand why when we look at European high speed rail operating costs (capital costs not included) of more than $ 0.25 per seat-mile which, at typical average occupancy rates of 50%, works out to around $ 0.50 per passenger mile. Compare this to FEC's revenue projections for All Aboard Florida of of $ 0.15 per passenger-mile, and you will get the drift. And don't let anybody tell you that it can be done cheaper in the United States. European conditions for high speed rail services are vastly superior to ours.
And how likely is it that 3 million people would actually use this rail service?
Miami receives annually close to 7.0 million foreign visitors, Orlando about 4.5 million. Orlando statistics reveal that foreign visitors average 8.8 nights in Orlando and 16.1 nights in the United States, which brings me to the assumption that most of the foreign Orlando visitors come in through Miami and also spend time there. When visiting a European city you get around with public transporation. Two weeks in Florida is going to require a rental car, which will take you from Miami to Orlando in 3.5 hours for less than $ 0.10 per passenger-mile. Why then bother to lug a lot of luggage on and off a train, which ends up costing you more without really having saved any time? Not to mention that the foreign visitors to Florida are avid shoppers at the outlet malls along the route.
My prediction is that very few, if any of them, will ever set their foot on All Aboard Florida.
Then let us assume that 10% of the entire populations of Dade, Broward and Palm Beach counties visit Orlando once a year. This would render some 600,000 posible candidates for train travel. But do you seriously believe that they would pack their car, only to park it for a week in the All Aboard Florida rail terminal garage at $ 15 per day, rather than heading straight for Orlando via the Florida Turnpike? I, for one, don't.
Let us get real about this. The economics behind All Aboard Florida just are not there, nor are the practical traffic and safety realities on the ground. If you get the urge to delve deeper into the subject of high speed rail, I can recommend "High Speed Rail in Europe and Asia: Lessons for the United States".
In addition to its core freight business, FEC aims to initiate a high speed passenger rail service between Miami, Fort Lauderdale, West Palm Beach and Orlando on its own right-of-way between Miami and Cocoa Beach, and from there on 40 miles of new track to be built to Orlando International Airport. In addition to several bridges along the way which need regularly to be opened for boat traffic, there are 350 high volume grade road crossings along the way, 114 of which in Palm Beach county alone. FEC plans to operate 16 trains offering a 3-hours transit time between Miami and Orlando with hourly departures in each direction, reportedly counting on three million passengers per year yielding operating revenue of $ 145 million. This works out to about $ 0.15 per passenger-mile. In 2012 the project was said to cost $ 1.0 billion, an amount currently stated to be $ 1.5 billion, still not unlikely to being seriously under-estimated.
It is my opinion that FEC and its financial backers would do well in reconsidering this venture.
A lot can be said against the technical practicality and safety issues of such a service on FEC tracks. For starters, high speed rail traffic in other parts of the world are fenced off over the entire length of the track and do not coexist with grade road crossings. As I understand it, FEC has no plans to invest in changing status quo in this respect. But before getting too worked up about these issues, I believe it to be relevant first to have a closer look at the economic fundamentals of the venture on the basis of well established data from the operation of high speed rail services in Europe.
Looking at 15 major European high speed rail services - which by chance work out to an average travel distance close to the one envisioned between Miami and Orlando - ticket prices average $ 0.40 per passenger-mile. Only a single one of these services, the one between Paris and Lyon, manages to exceed operating and capital costs. All the others lose money and are dependent on large tax-payer subsidies to stay in business.
We will understand why when we look at European high speed rail operating costs (capital costs not included) of more than $ 0.25 per seat-mile which, at typical average occupancy rates of 50%, works out to around $ 0.50 per passenger mile. Compare this to FEC's revenue projections for All Aboard Florida of of $ 0.15 per passenger-mile, and you will get the drift. And don't let anybody tell you that it can be done cheaper in the United States. European conditions for high speed rail services are vastly superior to ours.
And how likely is it that 3 million people would actually use this rail service?
Miami receives annually close to 7.0 million foreign visitors, Orlando about 4.5 million. Orlando statistics reveal that foreign visitors average 8.8 nights in Orlando and 16.1 nights in the United States, which brings me to the assumption that most of the foreign Orlando visitors come in through Miami and also spend time there. When visiting a European city you get around with public transporation. Two weeks in Florida is going to require a rental car, which will take you from Miami to Orlando in 3.5 hours for less than $ 0.10 per passenger-mile. Why then bother to lug a lot of luggage on and off a train, which ends up costing you more without really having saved any time? Not to mention that the foreign visitors to Florida are avid shoppers at the outlet malls along the route.
My prediction is that very few, if any of them, will ever set their foot on All Aboard Florida.
Then let us assume that 10% of the entire populations of Dade, Broward and Palm Beach counties visit Orlando once a year. This would render some 600,000 posible candidates for train travel. But do you seriously believe that they would pack their car, only to park it for a week in the All Aboard Florida rail terminal garage at $ 15 per day, rather than heading straight for Orlando via the Florida Turnpike? I, for one, don't.
Let us get real about this. The economics behind All Aboard Florida just are not there, nor are the practical traffic and safety realities on the ground. If you get the urge to delve deeper into the subject of high speed rail, I can recommend "High Speed Rail in Europe and Asia: Lessons for the United States".
Tuesday, December 3, 2013
FOREST BIOMASS FUEL FOR ELECTRICITY GENERATION
I was recently made aware of an article published in "Scientific American", discussing trends towards mitigation of CO2 emissions by substituting coal for forest biomass - particularly wood pellets - which I found less than useful.
There are in general quite a lot of misconceptions floating around on this issue, particularly the drive for biomass-for-coal substitution plans in Europe involving transportation of forest biomass over long distances. The arch-example is the English Drax power plant, converting 2,000 MW installed capacity to burn 7.0 million metric tons of wood pellets per year (according to Scientific American - in my book probably it should read more like 9.0 million tons, but never mind that for the moment).
IS WOOD BIOMASS CARBON NEUTRAL?
A tree extracts CO2 from the atmosphere while it grows, stores carbon in maturity and releases CO2 as it dies off or is burnt. In northern boreal forests this takes place over a very long term cycle of nearly 100 years. In commercial and sustainably managed southern pine plantations the cycle is reduced to around 15 years, and in the case of commercial eucalyptus plantations for energy use, 5 years.
If the harvesting of wood for energy purposes is equal to or lower than the regrowth cycle, the process is carbon neutral. If not, it is not. If the wood biomass is converted to pellets for the purpose of long distance transport economies, then the process is decidedly not carbon neutral. Let us look at the particular case of Drax.
To produce 7,000,000 ton pellets one needs 14,000,000 ton green wood. Let us assume that all this wood comes either from waste or sustainably managed plantations, or a combination of both. It requires close to 500 kWh energy to produce one ton pellets, mainly expended on evaporating water to reduce wood moisture content. Further assuming that this energy is generated with natural gas and not coal, we are still ending up with emitting around 1.5 million ton/a CO2, plus another 600,000 ton/a CO2 emitted from the ships bringing the pellets to England, plus whatever CO2 is emitted from fuel that is expended to bring the pellets to the port of embarcation.
Admittedly, from the point of view of England this may look like a brilliant ecological move, because were Drax to continue burning coal, the CO2 emissions would be something like 9.5 million ton/a. But this begs a question: Is CO2 emission a world problem or a national problem? It is obviously a world problem, in as much as CO2 accumulation in the atmosphere is not confined by national borders.
That being the case, and if our goal is to mitigate world CO2 emissions from fossil fuels, then why not place the power plant right inside sutainably managed forests, minimizing transport and avoiding alltogether the costly and wasteful conversion to wood pellets?
This is particularly the case for sub-Saharan Africa, which is both short on electricity and long on deforestation caused by scavenging of fuel wood. In European energy circles there has been serious consideration given to establishing very large forest plantations in Africa in order to supply European power plants with wood pellets.
When such reestablished and sustainably managed biomass resources can be converted to CO2 neutral electric power right at home, what could be more absurd than going to the trouble and expense to bring it all the way to Europe?
There are in general quite a lot of misconceptions floating around on this issue, particularly the drive for biomass-for-coal substitution plans in Europe involving transportation of forest biomass over long distances. The arch-example is the English Drax power plant, converting 2,000 MW installed capacity to burn 7.0 million metric tons of wood pellets per year (according to Scientific American - in my book probably it should read more like 9.0 million tons, but never mind that for the moment).
IS WOOD BIOMASS CARBON NEUTRAL?
A tree extracts CO2 from the atmosphere while it grows, stores carbon in maturity and releases CO2 as it dies off or is burnt. In northern boreal forests this takes place over a very long term cycle of nearly 100 years. In commercial and sustainably managed southern pine plantations the cycle is reduced to around 15 years, and in the case of commercial eucalyptus plantations for energy use, 5 years.
If the harvesting of wood for energy purposes is equal to or lower than the regrowth cycle, the process is carbon neutral. If not, it is not. If the wood biomass is converted to pellets for the purpose of long distance transport economies, then the process is decidedly not carbon neutral. Let us look at the particular case of Drax.
To produce 7,000,000 ton pellets one needs 14,000,000 ton green wood. Let us assume that all this wood comes either from waste or sustainably managed plantations, or a combination of both. It requires close to 500 kWh energy to produce one ton pellets, mainly expended on evaporating water to reduce wood moisture content. Further assuming that this energy is generated with natural gas and not coal, we are still ending up with emitting around 1.5 million ton/a CO2, plus another 600,000 ton/a CO2 emitted from the ships bringing the pellets to England, plus whatever CO2 is emitted from fuel that is expended to bring the pellets to the port of embarcation.
Admittedly, from the point of view of England this may look like a brilliant ecological move, because were Drax to continue burning coal, the CO2 emissions would be something like 9.5 million ton/a. But this begs a question: Is CO2 emission a world problem or a national problem? It is obviously a world problem, in as much as CO2 accumulation in the atmosphere is not confined by national borders.
That being the case, and if our goal is to mitigate world CO2 emissions from fossil fuels, then why not place the power plant right inside sutainably managed forests, minimizing transport and avoiding alltogether the costly and wasteful conversion to wood pellets?
This is particularly the case for sub-Saharan Africa, which is both short on electricity and long on deforestation caused by scavenging of fuel wood. In European energy circles there has been serious consideration given to establishing very large forest plantations in Africa in order to supply European power plants with wood pellets.
When such reestablished and sustainably managed biomass resources can be converted to CO2 neutral electric power right at home, what could be more absurd than going to the trouble and expense to bring it all the way to Europe?
Wednesday, April 3, 2013
THE GREAT WALL OF THE AMERICAS
No, this is not a pun on the Great Mall of the Americas of Minneapolis, Minnesota. I would rather wish it to be a light-hearted joke, but I am afraid it is not that, either.
Rep. Steven King (R-Iowa), an opponent of immigration, pronounced recently that building a fence along the approximately 2,000 mile long border with Mexico would not be too much of an engineering marvel.
"We can (sic) do the Panama Canal 100-plus years ago and I've been over there to take a look at the Great Wall of China that was built more than 2,000 years ago, and that's 5,500 miles long. So building a fence is not that hard; I'll just show you how to do it if it's too complicated for our public policy people to get their mind around."
For a Congress that cannot find the money to invest in straight-forward and badly needed infrastructure repairs such as fixing crumbling bridges and highways, it would for a starter be interesting to hear a floor debate on how to finance Rep. King's project. And as a point of fact, the Great Wall of China was not built 2,000 years ago. It was built, rebuilt and repaired over a period stretching from around 700 BC into the 1500s AD, so Rep. King's Great Wall of the Americas would presumably be a rather lengthy project too, under the best of circumstances.
The Chinese wall is not of uniform quality along its entire extension, but the more solid parts of it is on the average some 20 ft high, 20 ft across at the bottom and 16ft at the top. I assume Rep. King would not wish the United States government to be shamed into executing a project of lesser quality. For the 2,000 mile border with Mexico, that would mean a bit short of 34 billion cu.ft. (957 million m3) of construction material.
Let us compare the Great Wall of the Americas to another more recent Chinese mega-project, the Three Gorges hydro-power dam, which consumed 27.2 million m3 of concrete, 463,000 metric tons steel and 136 million manhours. Completed in 2006 the cost was $26 billion, with only a small fraction attributable to labor cost at Chinese wage levels.
Our Great Wall of the Americas would be equal to 35 Three Gorges dams in magnitude. In other words, 1.25 billion cu.yd of concrete, 18 million tons steel and 4.8 billion manhours. With Three Gorges cost equivalents brought current to 2013 as a yard stick, this should work out to $1,2 trillion for materials and equipment plus another $70 billion in (U.S.) labor for a total cost of, say, $1.5 trillion, without factoring in cost escalation during what presumably would be a rather lengthy construction period.
But asides from the massive misallocation of funds such a project would represent, why be anti-immigration at all in a country where 99.2% of the population is made up of immigrants? It is written thus on the New York harbor Statue of Liberty:
"Give me your tired, your poor, Your huddled masses yearning to breathe free, The wretched refuse of your teeming shore, Send these, the homeless, tempest tossed to me, I lift my lamp beside the golden door."
Those "huddled masses" of yore were indeed a mostly rag-tag collection of human beings, but I think we can all agree that they in time made their new home into a pretty successful nation. So why mess with a formula with such a splendid track record? The United States has the space and natural resources for further population growth and still has the good fortune to attract immigrants who wish to come here in order to improve their lot through hard work.
Instead of spending $1.5 trillion-plus on the Great Wall of the Americas, Target advertises 18"x30 welcome doormats for $12.99. I am sure we can get them wholesale (from China) at $5.00, at which price we could string them out edge-to-edge along the 2,000 mile border for a mere $20 million.
Rep. Steven King (R-Iowa), an opponent of immigration, pronounced recently that building a fence along the approximately 2,000 mile long border with Mexico would not be too much of an engineering marvel.
"We can (sic) do the Panama Canal 100-plus years ago and I've been over there to take a look at the Great Wall of China that was built more than 2,000 years ago, and that's 5,500 miles long. So building a fence is not that hard; I'll just show you how to do it if it's too complicated for our public policy people to get their mind around."
For a Congress that cannot find the money to invest in straight-forward and badly needed infrastructure repairs such as fixing crumbling bridges and highways, it would for a starter be interesting to hear a floor debate on how to finance Rep. King's project. And as a point of fact, the Great Wall of China was not built 2,000 years ago. It was built, rebuilt and repaired over a period stretching from around 700 BC into the 1500s AD, so Rep. King's Great Wall of the Americas would presumably be a rather lengthy project too, under the best of circumstances.
The Chinese wall is not of uniform quality along its entire extension, but the more solid parts of it is on the average some 20 ft high, 20 ft across at the bottom and 16ft at the top. I assume Rep. King would not wish the United States government to be shamed into executing a project of lesser quality. For the 2,000 mile border with Mexico, that would mean a bit short of 34 billion cu.ft. (957 million m3) of construction material.
Let us compare the Great Wall of the Americas to another more recent Chinese mega-project, the Three Gorges hydro-power dam, which consumed 27.2 million m3 of concrete, 463,000 metric tons steel and 136 million manhours. Completed in 2006 the cost was $26 billion, with only a small fraction attributable to labor cost at Chinese wage levels.
Our Great Wall of the Americas would be equal to 35 Three Gorges dams in magnitude. In other words, 1.25 billion cu.yd of concrete, 18 million tons steel and 4.8 billion manhours. With Three Gorges cost equivalents brought current to 2013 as a yard stick, this should work out to $1,2 trillion for materials and equipment plus another $70 billion in (U.S.) labor for a total cost of, say, $1.5 trillion, without factoring in cost escalation during what presumably would be a rather lengthy construction period.
But asides from the massive misallocation of funds such a project would represent, why be anti-immigration at all in a country where 99.2% of the population is made up of immigrants? It is written thus on the New York harbor Statue of Liberty:
"Give me your tired, your poor, Your huddled masses yearning to breathe free, The wretched refuse of your teeming shore, Send these, the homeless, tempest tossed to me, I lift my lamp beside the golden door."
Those "huddled masses" of yore were indeed a mostly rag-tag collection of human beings, but I think we can all agree that they in time made their new home into a pretty successful nation. So why mess with a formula with such a splendid track record? The United States has the space and natural resources for further population growth and still has the good fortune to attract immigrants who wish to come here in order to improve their lot through hard work.
Instead of spending $1.5 trillion-plus on the Great Wall of the Americas, Target advertises 18"x30 welcome doormats for $12.99. I am sure we can get them wholesale (from China) at $5.00, at which price we could string them out edge-to-edge along the 2,000 mile border for a mere $20 million.
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