Thursday, July 31, 2008

HHO or HHype?


With gas at $4.00 a gallon, who isn't thinking about ways to make the daily commute a little cheaper. I have a friend who runs a blog called "HHO Gas" and has been talking about this stuff like crazy. Shop DriveTime First! Bad credit, no credit, no problem. Apply on-line.

The pitch goes, "Run Your Car on Water," or improve your gas mileage by adding hydrogen gas to your air intake. Lots of claims have been made that it will increase fuel economy by 60% etc.

Being the natural skeptic, I decided to look into this. I have read several articles both pro and con on the topic. HHO gas, more correctly called Brown's gas, or Oxyhydrogen, was the precursor to acetylene. It is flammable and was also used before incandescent light bulbs.

But will it improve your gas mileage? While you can check out the biggest hawker, water4gas, I also saw a good news report here. The news team in Florida used a product called the Hydro 4000. They tested a vehicle and found that it improved mileage by about 10%. It also required that the driver put a cup of distilled water in the system about every 60-80 miles. Guard against ID Theft with 15 Points of Protection from TrustedID, including our $1,000,000 Warranty. Click Here!

I further checked with the Better Business Bureau about the maker of the Hydro 4000, 1 Freedom Inc. Here is a link to the report. While there are no customer complaints, the company has been warned to stop using the Better Business Bureau logo.

While there definitely is a lot of hype around the issue and no 3rd party laboratory has provided an analysis, there is some indication by some parties that it may work. Yes, that is less than a definitive answer, however, I need more proof.

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Your Garbage, My Money

While many of my regular readers may think that I am opposed to all things green, allow me to disabuse you of that notion. I believe in doing things that are cost efficient and effective, like green roofs. You can read my blog, Clean Air through Green Roofs .

I am a big fan of recycling, particularly those things that make sense to recycle, like steel and aluminum. However, when it takes more resources to recycle than it takes to make the product from scratch, I am skeptical.

In the July 24th edition of Business Week, there is an article titled, "Cash for Trash." It discusses how not only are traditional waste management companies making money from recyclying, but venture capital money is going to firms, "...which includes everything from materials recovery to sewage biotechnology..."

There is a simple "why" to the question of increased recycling.

"The calculus is simple: As the prices of oil and other raw materials rise, recycled products become more attractive. Consider that 8% of global oil production is siphoned off to make plastic each year. Recycled plastic, however, requires 80% less energy to produce. Recycled aluminum burns up 95% less energy. Recycled iron and steel use 74% less, while paper requires 64% less."

So there you have it. Recycling now is worth it! Is anybody surprised? They shouldn't be. In a world of ever shifting commodity prices and consumer tastes, new markets show up to take advantage of any disequilibrium. When the cost of oil and metals goes down, don't be surprised to see recycling businesses fade away, just like in 2002, when "Mayor Michael Bloomberg, ...suspended the city's glass- and plastic-recycling services in 2002..." Things change, markets change, tastes change and generally that's good, because that's how markets are made.

Wednesday, July 30, 2008

Nuclear, India Style

India is not only one of the world's largest countries by population, it is also on of the largest consumers of electricity. However, India suffers insufficient power generation and distribution networks, making stable and continuous power a very hard target.

In the July 24 issue of Business Week, titled "All Eyes on India's Nuclear Prize," the article, while focused on who is getting business to build 30+ reactors, also spells out India' commitment to clean, nuclear energy.

When it comes to spending about $100 billion of government money, one can bet on controversy. Additionally, when that money is to spent on building safe, reliable, clean, nuclear plants, one can count on the leftists to scream the loudest.

So, should one be suprised when the article states, "Communist members of Singh's coalition opposed it and walked away from the government, forcing a confidence vote on July 22." If one followed the news, they would see that Singh survived the confidence vote.

Lest anyone question the need India has for power, consider this quotation:

"And as the economy expands, New Delhi hopes to quintuple nuclear energy production. "Demand for electricity is so large," says R.B. Grover, India's chief negotiator for the nuclear deal, "that we can accommodate all countries" willing to help build capacity.

All the best to India and its nuclear power expansion. If they are successful, perhaps the can reduce the number of coal and oil plants and really reap the fruits of clean, safe, and reliable, nuclear power.

Monday, July 28, 2008

Germany Loses its Mind-Follow Up

First, thank you to all my readers. I hope you are finding the posts worthwhile and occasionally humorous. I pride myself on the research that I do for each post, as well as my professional experience and Masters-level education. And yes, nuclear energy is safe, very safe.

I would like to post a comment to one of my posts on Germany's decision to decommission nuclear plants in favor of wind farms. Again, thank you for your comments.
Anonymous said...

I hope nobody reads your ramblings, mate. You clearly ignore the horrors and suffering that Chernobyl caused and still continues to cause to Eastern Europe. Nuclear energy is not safe, period. Anyone who says so is ignoring the number of accidents around the world that get reported 2-years after they happened -- or never if they can conceal it (Russia?).

We -- Germans -- simply do not trust the people working in nuclear power plants. The technology may be alright, but the human beings inside are no computers, we all make mistakes. Chernobyl was no technical issue, but a series of very unlikely human errors. As long as we are in control, nuclear power is not safe. OTOH I wouldn't even think about giving a computer total control over such a thing.

And please, stop bragging about your superior common sense, when it sounds more like some down-home-hokum. You clearly have little facts at your hands as you continue to accuse every other person on this planet to have none.

Look at some pictures of the people dying in Chernobyl and read about their stories and then remember that it was a human error that can and will happen again. Maybe this could teach you some compassion.

And while we're at it, just buy a bike and use it instead of a car and choose home appliances by their energy usage -- the German build ones are pretty good at this, maybe then you can understand that our environment is pretty dear to us.

So, if you research nuclear power generation globally, you will find that the Russians failed to build a secondary containment unit of reinforced concrete, which is standard for ALL Western nuclear plants. If they had done that, the deaths and devastation wouldn't have occurred.
The French and the US have managed to run nuclear plants without fatalities for over 30 years. Guess what, that's a lot safer than flying in a plane or riding a bicycle!! Human error is real. However, with proper planning and risk management, nuclear power generation remains the cleanest and safest, without exception.

We pray for the souls of the dead and injured from Chernobyl, but also place the responsibility where it belongs, squarely on the shoulders of the haphazard Russian builders.

Sunday, July 27, 2008

Only Because Its Funny...

Is that Al Gore with the chainsaw?

Thursday, July 24, 2008

Common Sense vs. Ethanol

As I wrote in a previous post, "Adding up the Cost of Ethanol," the production of ethanol takes more fuel than it creates, it uses 10,000 liters of water for the 5 liters it returns, and it is made by using food crops. As you can imagine, this is about one of the worst strategies for decreasing dependence on foreign oil.

Finally, responsible adults have started to speak up. Governor Rick Perry of Texas has asked the US EPA " temporarily waive regulations requiring the oil industry to blend ever-increasing amounts of ethanol into gasoline." according to the New York Times. His contention is that ethanol is causing food prices to sky rocket, including animal feed. Of course, farmers and ethanol producers don't want any waiver.

Some big names have lined up on both sides of this issue. "Senator Kay Bailey Hutchison, Republican of Texas, has introduced legislation calling for a freeze of the mandate at the current level, saying it “is clearly causing unintended consequences on food prices.” The measure is co-sponsored by 11 other Republican senators, including John McCain, the presumptive presidential nominee." Some could argue that these Senators are in the pocket of ranchers and the preeminent boogie man, "Big Oil."

That same argument can be applied by those who are against the waiver, namely Senator Chuck Grassley of Iowa. He has been a major recipient of ADM largess. Grassley has stated that support of this waiver is "treasonous." Sure, treason. Good grief!

There is another way to look at this, though. Corn farmers are claiming that fuel costs, as well as those for fertilizer have gone up, thus his prices have to go up to cover his costs. That is reasonable. They also claim that they geared up to meet the regulations and demand for ethanol. If that demand changes because of a change in regulation, then they are stuck with way too much corn. While I sympathize with argument, hey, that's business. How did every liquor manufacturer feel when Prohibition went into effect? The same is true for Freon and other things that regulation has changed the market for.

So what does all of this mean? Probably not much. Oil is still expensive. Anything that uses petroleum and its associated products are going up in price. With or without ethanol, the cost of a bushel of corn will probably stay fairly high, because of the cost of fuel and fertilizer. However, it is good that folks are finally catching on that ethanol is a loser.

Tuesday, July 22, 2008

Oil Speculation is Good!

Does $4 gas get you down? How about those high airline fares? I have heard the cry, "Quick Congress, do something!!!" Airlines have sent emails and taken out ads decrying speculation, yet if I recall, all airlines buy oil futures. Yes, buying futures is the same as speculating, and it is good!

In the 22 July edition of the Wall Street Journal, there is an editorial titled, "An Energy Sarbox." The editorial clearly details the 40 hearings Congress has had and all of the associated hand wringing. Before we go any further, the future purchasing of commodities is good for all consumers. It allows for businesses to plan how much of any commodity they will consume in the future, and for what price. It allows these same businesses to set stable prices. Additionally, it allows for contracts to be made on future outputs at fixed prices.

Back to the knuckleheads in Congress, the article spells out how the left goes back to the old power play book. Declare a crisis, then move in to increase power.

"Instead of merely increasing funding and manpower at the US Commodity Futures Trading Commission, it vastly broadens the CFTC's regulatory purview. It also orders the CFTC to distinguish between "legitimate" and "non-legitimate" traders."

So what happens when US lawmakers make doing business in America too expensive and difficult? They leave. So, if Congress wants to "wring the speculation out of the market," they are going to run all commodity exchanges out of the country. Yes, that would be the NYMEX (New York Mercantile Exchange) and the Chicago Mercantile Exchange. Guess what happens when things go overseas? You got it, they can't be regulated. So much for regulating "speculators," Congress!

Monday, July 21, 2008

Nuclear, American Style

I have written about nuclear power on two occasions, "Build Wind, Drop Nuclear? Germany Loses its Mind!" and "Nuclear, Silver Bullet or Money Pit." While I generally have a positive outlook on nuclear power, I must agree with William Tucker, author of "Terrestrial Energy: How Nuclear Power Can Lead the Green Revolution and End America's Long Energy Odyssey," which is due out in September, as to how the US can do it better.

In the 7-12-2008 edition of The Wall Street Journal, Mr. Tucker writes an editorial titled, "Let's Have Some Love for Nuclear Power." He outlines the strengths and weaknesses of the current energy situation in the US, and points out how coal, while abundant and efficient, creates significant amounts of CO2 and other pollutants. He also clearly spells out the costs and inefficiencies of solar and wind.

What makes Mr. Tucker's discussion unique is that he points out the need to allow investors to decide whether to invest in nuclear, and not just rely on subsidies. As I mentioned in my "Silver Bullet" post, some companies have decided not to pursue new nuclear plants. For nuclear to be successful, a stable, regulatory environment must be in place, as well as re-allowing the recycling of spent nuclear fuel.

Government, yes I said government, can help out in both instances. Regarding regulation, the US government has improved and streamlined the process for building new plants. Now all it needs to do is overturn that genius president, Jimmy Carter's ban in fuel recycling. Tucker gives an easy to understand example. France, which has produced 80% of its electricity needs from nuclear over the past 30 years, recycles its spent fuel. The waste product fits in one small underground room. Imagine if the existing spent fuel could be recycled for fuel, as well as industrial and medical purposes, not only would nuclear power be even less costly, but actual waste would be reduced.

Let's here it for more clean nuclear power, as well as nuclear recycling!

Friday, July 18, 2008

Sacrifice for Thee, but Not for Me

I will let this video speak for itself. Al Gore goes to give his energy speech (read tax, tax, tax) in Washington, and arrives in a fleet of Lincoln Towncars. One of which idles for 20 minutes, while running the AC.

Thanks to (http:\\

Thursday, July 17, 2008

Guess what?! I've got a fever, and the only prescription... is more cowbell!

Like Christopher Walken says in the Saturday Night Live sketch, leftists around the world say about taxes. However, it really goes something like this: "There is some made up crisis, and the only prescription is more taxes!" Or government control, but you get the picture.

In a previous post, "I'm the Taxman, Yeah the Taxman," I detailed how the United Kingdom is looking for more taxes to make the UK more "green." Not to be outdone, the wild man from Tennessee, Al Gore, according to CNN, "...has pushed for polices that would reduce the emission of carbon dioxide, such as greater energy conservation and the development of alternative energy sources like wind and solar energy. Gore has also advocated for governments to tax the emission of carbon dioxide."

Why is Al Gore promoting this? Because he is a big fan and shareholder in a carbon credit business, but I digress.

Green taxation, according to the Institute for Local Self-Reliance, has been around for 15 years. It seems that they want taxes to:

* to generate revenue to pay for damages created from past pollution and for measures to reduce future pollution

* to change behavior

* combine(s) a significant pollution tax with a major restructuring of the tax system to make the overall economy more efficient. This process is called "tax shifting."

While they recognize green taxes are regressive, that is they hurt poor people the most, and not folks like Ted Kennedy and Barbara Streisand, the ILSR states: "One way to deal with the inequities resulting from an across the board carbon tax would be to return a significant portion of the revenue to the low income community for energy efficiency."

Well look what we have here. It is all just another income redistribution scheme with a helping of Nanny State on top. So there you have it, the earth is falling apart! Tax everybody! Leftists have the answer! Do I need to put in a sarcasm tag?

Wednesday, July 16, 2008

Gee, Ya' Think?

While not specifically questioning green technology, today's post is about oil prices and the crystal clear example of economic efficiency/supply and demand.

The AP, via Yahoo!, posted a story titled "Oil prices tumble again on US surprise supply jump." As you may or may not know, the price of a barrel of oil has fallen approximately $10 in the last two days. As you also may or may not know, oil is sold on the world market in US dollars. While the discussion of using oil as a hedge against a weakening dollar and inflation is legitimate, the story highlights the real cause, people just aren't consuming!

From the article:

"The Energy Information Administration reported that U.S. crude oil supplies rose by 3 million barrels, or 1 percent, last week. That is the opposite of the 3 million barrel draw analysts surveyed by energy research firm Platts expected. Gasoline supplies also leapt unexpectedly."

So, there you have it. People and businesses are just consuming less. Whether it is gas at $4.08 a gallon, or crude at $146, people and businesses have reached the point where they will no longer bear the price, and thus supply is increasing. Provided that consumption remains flat or continues to decrease (globally), prices will continue to fall.

And guess what, the US government and states still collect about $.26 a gallon. However, they are concerned that reduced consumption will cut into their revenue stream.

Tuesday, July 15, 2008

Hybrid Hummer Hums

**Read the follow-on article, "Big Green Trucks!" and learn about flywheel hybrids here!**

Huh? A Hummer hybrid? Yes, the picture you see is of a Hummer H1 Hydraulic Hybrid. Hybra Drive Systems and Gates Corporation built this Hummer H1 with a fully hydraulic power train. Cheap? No. 100% Free. Trade stocks for free on The Free Trading Community.

So, what is an hydraulic hybrid and what should anybody think about them? Much like any other hybrid, there is an gas/diesel engine that is mated with another motor powered by some other source. Most passenger car hybrids are gasoline engines with battery-powered, electric motors, while hydraulic hybrids don't use batteries, but rather hydraulic accumulators to store energy. Hybrid batteries are store approximately 1.3 Kw/hr, while hydraulic accumulators "...have power densities of roughly 500 kW/kg, according to Jim O’Brien, founder and chief technology officer for Hybra Drive Systems, a start-up focusing on the development of hydraulic power trains." (found at

They work this way, from Design News:

Design concepts for hydraulic hybrids vary, but the car’s engine powers a hydraulic pump motor, which charges a high-pressure accumulator. The accumulator, in turn, drives one or more additional pump motors connected to the wheels. A second lower pressure accumulator completes the hydraulic circuit. Depending on the design, there may be one pump motor to drive a pair of wheels through a differential or one pump motor per wheel for an all-wheel-drive version with independent torque control. During braking, the pump motors on the wheels reverse themselves, re-charging the accumulator and capturing energy that would otherwise be lost to heat.

OK, so why is this better than an electric hybrid and why isn't it available today? For one reason, it will be easier to dispose of hydraulic fluid than it is to recycle hybrid batteries. Secondly, because they are just so efficient over battery hybrids. Would you feel better if you had more energy? Try FRS® Healthy Energy™ Free*!

"Kargul (Technology Transfer Director at National Vehicle and Fuel Emissions Lab) says the gains came from three sources — running the engine at its sweet spot, operating the vehicle with the engine off and capturing braking energy. The regenerative braking capabilities of these systems... can far outshine the electric hybrids... made possible by the high power density of accumulators. Kargul says the EPA’s hydraulic hybrids typically capture at least 70 percent of the braking energy otherwise be lost to heat. He estimates electric hybrids capture more like 20 to 25 percent, because their batteries... have comparatively poor power density. “You would have to triple the size of the batteries to come close to 70 percent,” he says.

Although hydraulic hybrids are now being used in pilot programs on mainly commercial trucks, there are passenger cars being tested also. The current delay to mass acceptance is that the hydraulic pumps are big and expensive. Additionally, the most efficient system will have to do away with the typical, mechanical transmission.

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While these challenges aren't insurmountable, they do allow for battery hybrids to rule the roost, so to speak. Fortunately, the free market is learning about this concept, and have begun to catch on. Parker Hannifin, Siemens and Eaton Corporation are the leaders in providing the hydraulic components, not to mention successful companies in their own right.

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Sunday, July 13, 2008

A Tribute To the Late Tony Snow

If you live in the US, you are aware that former Presidential Press Secretary, Tony Snow, passed away this weekend. His passing and my tribute to him are relevant to this blog because, in the words of Rush Limbaugh on Fox News Sunday, "He would unfailingly challenge the premise of many of the questions. I'd never seen this before in a press secretary,..He challenged the premise and told them that they were wrong in the narrative or the storyline that they were tacking, and this caused the president's supporters, those who had seen it, to stand up and cheer." In this blog, I challenging the premise of the conventional wisdom "solutions."

Vice President Dick Cheney had this to say:

"He had this rare combination of intelligence, of commitment and loyalty to the president that he was working for, but also this great love of going out behind that podium and doing battle with what in effect were his former colleagues. And it was this capacity that he had to be unfailingly polite, to maintain good humor under the most trying of circumstances, and do it, I thought, better and more effectively than anybody I've ever seen in that post," Cheney said."

President George W. Bush presented these remarks:

"Laura and I are deeply saddened by the death of our dear friend Tony Snow," President Bush said in a written statement. "The Snow family has lost a beloved husband and father. And America has lost a devoted public servant and a man of character."

Here are the links to some of his colleagues' tributes:

Britt Hume:

And the White House Press Corps:

God Speed to you Tony Snow, and may you find your eternal reward in Heaven. God Bless you and your family.

Friday, July 11, 2008

Green Losers

The purpose of this blog has been to use rational thinking and basic economic principles to evaluate the more popular solutions to the "green crisis." While I promote conservation, new technology, and a clean environment, they all have to be approached with an understanding of costs. When the need to evaluate a position no longer requires empirical data, it is going to be a bad decision.

Business Week reported in the June 30 print edition that companies who signed up for the US EPA's Climate Leaders Initiative lost, on average, 0.9% of its share price in two days, "...more than it would have from normal market factors." This was the result of research done by two Dartmouth College professors, Karen Fisher-Vanden and Karin Thorburn.

The studies goes on to point out that:

Companies in carbon-heavy industries such as utilities, though, don't take as much of a hit. In those cases, ...investors view participation as a preemptive move against all but certain regulations."

What this article points out is that the market doesn't view cutting greenhouse gases as good way to spend the shareholders' money, at least in some industries. Rational investors seem to have figured this out, change when necessary, but not before.

Global Warming, Mental Disorder?

When discussing the latest "crisis," whether its global warming, global cooling, el Nino, la Nina, etc., the discussion can be taken to an extreme.

In an article from the Herald Sun of Australia, titled "Doomed to a fatal delusion over climate change," a poor child was diagnosed with "Climate Change Delusion." Allow me to first offer my deepest and sincerest concern for the welfare of the child and his family. However, I am discussing this article because of the often irrational nature that global warming and "carbon" believers display.

Andrew Bolt writes:

Writing in the Australian and New Zealand Journal of Psychiatry, Joshua Wolf and Robert Salo of our Royal Children's Hospital say this delusion was a "previously unreported phenomenon".

"A 17-year-old man was referred to the inpatient psychiatric unit at Royal Children's Hospital Melbourne with an eight-month history of depressed mood . . . He also . . . had visions of apocalyptic events."

Although Mr. Bolt is writing an editorial, he seems to identified some pretty clear characteristics that have recently been displayed by both US and Australian government leaders. US Senate Majority Leader Harry Reid (D-NV) said, "...coal makes us sick, oil makes us sick..." as he discussed the need for alternative energy to replace fossil fuels (good grief!).

Not to be outdone, the Prime Minister of Australia, Kevin Rudd said:

"If we do not begin reducing the nation's levels of carbon pollution, Australia's economy will face more frequent and severe droughts, less water, reduced food production and devastation of areas such as the Great Barrier Reef and Kakadu wetlands."

What empirical evidence does he give for this frightening scene? None specifically, just the advice of another green advocate, Professor Ross Garnaut:

"Australians must pay more for petrol, food and energy or ultimately face a rising death toll . . ."

Wow, it becomes clear, doesn't it. These folks have a vision about how they want people to live. Most people don't agree with that vision, so Rudd and Garnaut are trying to scare people into believing they are in danger and will have to part with their own wealth and lifestyle to fit the deluded visions of the disciples of green.

So, what do China and India, the world's biggest polluters, say about this?

...Ma Kai, head of China's powerful State Council: "China does not commit to any quantified emissions-reduction commitments . . . our efforts to fight climate change must not come at the expense of economic growth."

From India,

... the Prime Minister's Council on Climate Change, said India would rather save its people from poverty than global warming, and would not cut growth to cut gases."

In other words, green ideas and carbon cutting are not in the best interest of the developing world. It is refreshing to see governments exercise enlightened self-interest and the well-being of its citizens as guideposts for policy decisions. When will liberal guilt in the West end and common sense return? Soon, I hope.

Tuesday, July 8, 2008

I'm the Taxman, Yeah the Taxman

Apologies to the Beatles, but the silliness of the "green" movement has hit the United Kingdom.

In its quest to have a low carbon economy the government is going to do what? You guessed it, tax their citizens more!! Most green technologies are either too new or not efficient and thus require subsidies. In other words, the government knows better than its citizens, as to how to spend the citizens' money.

From Reuters:

The green money machine strikes again!

Adding Up the Cost of Ethanol

***Be sure to read the follow up article, "Common Sense vs. Ethanol." ***

While many believe that ethanol is reducing our dependence on foreign oil, many forget the real costs involved in creating ethanol from corn. It is energy intensive. Indoor gardens

In an article in Human Events titled, "Alternative Fuels are not an Alternative," A.W.R. Hawkins lays out the true costs of ethanol. From the article:

" takes 1.3 gallons of gasoline to produce one gallon of ethanol. Moreover, that one gallon of ethanol that is produced through the burning of 1.3 gallons of gasoline contains one third less energy than a gallon of gasoline, according to Iain Murray, senior fellow at the Competitive Enterprise Institute. This means that by the time you burn 1.3 gallons of ethanol, which is what it takes to equal the energy of a gallon of gasoline, you have actually already burned 1.73 gallons of gasoline simply to produce the cleaner burning 1.3 gallons of ethanol that “replaced” it.

Something that the article also mentions is the water requirement to produce ethanol. Water? That's right, "According to David Olive of the Toronto Star, ethanol requires us to pour 10,000 liters of water on a field of corn in order to receive 5 liters of fuel in return." According to Business Week, "By 2030 nearly half of the world's population will inhabit areas with severe water stress, according to the Organization for Economic Cooperation & Development." Water Barrels and Storage

Not only does ethanol production destroy a food crop, consume vast amounts of precious water, it also requires the burning of more fossil fuels than it generates. In a world of "feel good" solutions to real problems, ethanol continues not to make economic sense, nor is it economically efficient. Here is possible resource for fuel economy better than ethanol.

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Monday, July 7, 2008

The Free Market Strikes Again!

The free market has struck again! According to a press release from the US Department of Transportation, "Americans Drove 1.4 Billion Fewer Highway Miles in April of 2008 than in April 2007 While Fuel Prices and Transit Ridership Are Both on the Rise."

While one may view this news as good or bad, here is what the US government is really concerned about, taxes!

“We’re burning less fuel as energy costs change driving patterns, steer people toward more fuel efficient vehicles and encourage more to use transit. Which is exactly why we need a more effective funding source than the gas tax,” Secretary Peters said."

So, which is it, drive more fuel efficient cars and take the bus, or drive Hummers and pay more in gas tax?? While I think reducing taxation is great and should be done more often, I am not fool enough to think crumbling roads and bridges are a good thing.

As the title mentions, the free market will decide these things. Folks will drive less and change other gas-influenced behaviors as the costs increase, and more than likely, find ways to pay less in taxes, if given the choice. I guess we will have to wait and see.

Sunday, July 6, 2008

Build Wind, Drop Nuclear? Germany Loses its Mind!

**See the updated articles Germany Loses its Mind Follow Up and A Nuclear Renaissance in Germany?.
If it ain't broke, don't fix it! That is a piece of conventional wisdom I agree with. However, Germany is more focused on "green" love than common sense.

As reported in an article on Yahoo!, "Germany wants to build 30 wind farms," Germany is going to close 17 nuclear plants and build wind farms instead. Brilliant! Talk about disturbing the environment with 30 new wind farms, ask Teddy Kennedy and Walter Cronkite how they feel about wind farms in Nantucket (story here).

Unfortunately, Angela Merkel has been cowed by the Greens. From the article,

"The government has agreed to honour a decision to close the country's 17 nuclear power plants by 2020 but remains divided over the issue.

Merkel insists that a nuclear phase-out would hinder efforts to slash Germany's dependency on greenhouse gas-producing fossil fuels.

But Tiefensee, a member of Merkel's Social Democrat coalition partners, said that investing in windfarms was better than keeping the nuclear plants running.

"We believe in renewable energy and not in nuclear energy.""

Whether or not Tiefensee and the other socialists in Germany "believe" in renewable energy, one can't change the fact that nuclear is more efficient both in cost and energy output. Empirical data is always better than beliefs when it comes to money.

Thursday, July 3, 2008

Progressive, Socialist, What's the Difference?

Many of the topics I have written about so far have been darlings of the "Progressive" movement. These leftists, many of whom refer to themselves as socially conscious, may not be aware of the very tight correlation of their personal views and those of socialists around the globe. While many of the personal goals and feelings of progressives are noble, they often fail to understand the consequences of policies associated with their goals.

Here is an interview from YouTube, conducted by John Stossel of ABC News. It starts out with a general discussion of employment, starting with Europe. The title of the video is inaccurate, but enjoy it anyway.

Tuesday, July 1, 2008

Nuclear, Silver Bullet or Money Pit

When discussing the "energy crisis," one of main issues is electricity, including its generation and distribution. In the US, electricity is mainly generated by burning fossil fuels, however, nuclear power generates about 20% of nations electricity, with hydroelectric, and to a much smaller degree wind and solar rounding out the list (numbers, source EPA).

When considering what is the most efficient as well as "best" for the environment, nuclear seems to be a pretty good option. Its day to day generation of electricity doesn't produce any green house gases or other pollutants to global warming adherents fear. Were that not enough, the French produce 80% of their electricity through nuclear power. So why not more here in the US? Cheap? No. 100% Free. Trade stocks for free on The Free Trading Community.

In the July 7, 2008 print edition of "Business Week," there is an article titled, "Nuclear's Tangled Economics," (which is the source of all quotations in this post). It highlights presidential candidate John McCain's desire to have 100 new nuclear power plants. The article also highlights that current estimates put the cost at new plants at about $7 billion dollars. While that number is expected to grow as the cost of materials to build the plants grow, the question is whether it makes sense for power companies to build them.

One the first issues any such project is going to contend with is the cost of regulation. Fortunately, the US has standards for building new plants, as well as more efficient regulation. However, some power companies have decided to drop their projects. Most notably, MidAmerican Energy Holdings, "... a gas and electric utility owned by Warren Buffet's Berkshire Hathaway, shelved its own nuke plan earlier this year, saying it no longer made economic sense." Protect your Medical Identity with TrustedID. $1,000,000 Warranty & Great Customer Service

While Berkshire Hathaway shareholders should be grateful for the careful financial management of the company, they may also consider that NRG Energy, Dominion Resources, Duke Energy, and "...six other companies have already leaped to file applications to construct and operate new plants largely because of incentives Congress has put in place." The incentives are not just tax credits, but also $18.5 billion in loan guarantees. Considering the status of the credit markets, the loan guarantees can make all of the difference. eFax Annual Subscription

While nuclear energy is clearly one the best, proven, and clean technologies for electricity generation, it isn't without commercial risk. Each power company is going to have to review the risks, their capital positions, and the economic climate to determine is building a new, nuclear power plant is right for the share holders.

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Reformulated Gas, Improving the Environment or Waste of Money?

In the US Midwest, gasoline was required to be reformulated, based on regions and their air quality conditions, under the 1995 Federal Clean Air Act. "Boutique blends" were created with the purpose of reducing ozone. Understandably, any time a standard product is customized, it increases its cost, and with these boutique blends are definitely more expensive, $0.14 more per gallon to be precise.

The Milwaukee Journal Standard posted an article on June 30 titled, "Some experts question benefits of reformulated gas, Wisconsin asks EPA to eliminate special fuel requirement," detailing the local experience with these blends.

The first point of the article is that the EPA hasn't been able to measure the effect of the reformulated gas as several other factors have changed. Automobiles now have better emissions systems, making them ULEV (ultra-low emission vehicles), as well as cleaner burning, non-formulated gasoline. As US fuel standards become more strict, the value of reformulated gasoline declines.

It should be clear to any consumer, as well as government regulators that with sweeping changes, cost-benefit analysis needs to be performed to insure the highest benefits are achieved at the least cost.

US Representative Paul Ryan (R-Janesville), says it best:

"Wisconsin is being needlessly penalized, ... Reformulated gas is an economic burden on motorists because a limited number of refiners are producing it and it's only being sold in specific markets, ... The current system basically sets up a system for high prices," Ryan said. From Green Bay to St. Louis, there are five different blends of fuels. That makes absolutely no sense.'"
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