Talking sense

Wind power is a folly for which businesses and, let us not forget, domestic consumers pay dearly.

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Climate sensitivity and the Stern report

From time to time I have been taking a look at the Stern Review. It seems so central to the cause of global warming alarmism, and while there's a lot to plough through this does at least mean that one may come across something new.

As part of my learning process, I have been enjoying some interesting exchanges with Chris Hope of the Judge Business School at OxfordCambridge. Chris was responsible for the PAGE economic model, which underpinned Stern's work. The review was based on the 2002 version of the model, but a newer update - PAGE 2009 -  has now appeared and I have been reading up about this from Chris's working papers, in particular this one, which looks at the social cost of carbon.

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Jo Nova on the fossil fuel "subsidies"

Jo Nova has done an indepth analysis of the "fossil fuels are subsidised" argument, knowingly and misleadingly promoted by environmentalists and their political friends around the world.

Groups like Greenpeace and The Australian Conservation Foundation argue that really, Governments are helping fossil fuel companies far more than green ones. But while governments rewrite national economies to help “green” companies, about half of the help for fossil fuels is simply that the government didn’t take as much off them as it could. The net flow of money is still from Big-Fossil-Energy towards Big-Government. It takes a special kind of grand entitlement to call that a subsidy.

A must-read.

Fisking Renewable UK

Delingpole is seeking help in fisking the claims made about wind power by RenewableUK (formerly the British Wind Energy Association). The specific claims are in this article by the organisation's deputy CEO, Maf Smith:

Why I don’t think wind costs the earth

By Maf Smith Deputy Chief Executive, RenewableUK

Britain is the windiest country in Europe so let’s use it to the full. We have enough wind energy installed to supply nearly five million households all year round. We already get five per cent of our electricity from wind turbines – we’re on course to get 25 per cent of it by 2020. Turbines don’t need much wind to start turning that’s why they generate electricity for at least 80 per cent of the time.

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Peter Lilley comments

I noted in an update to the the "Stern Exposed" thread that Chris Hope said that he had found an error in Peter Lilley's article about the Stern Report. Lilley has now added a comment pointing out what has happened. I'm reproducing it here.

I have posted this response to Chris Hope's query on his website:

Dear Chris
Thank you for querying the figures I attribute to the PAGE2002 Impact Assessment Model.
In fact the figures I quote do come from your model – Figure 5 on page of your explanatory article The Marginal Impact of CO2 from PAGE2002: An Integrated Assessment Model Incorporating the IPCC’s Five Reasons for Concern. They are line 7 and refer to India so my paragraph should have read:

“The model is given a range of assumptions of impacts on the GDP of each geographic area for a 2.5°C rise in temperature. Thus, IN INDIA a 2.5°C temperature rise is deemed to reduce GDP by between 1.5% and 4% - with a median 2% loss. The loss is then set to increase as a power of temperature ranging between linear and cube – averaging 1.3.”

The words IN INDIA somehow got erased and I will reinstate them in future versions especially as it then makes more sense.

You also single out India in your excellent presentation to the Yale Symposium – page 48 where you point out that though “adaptation reduces impacts by 90% in OECD countries” it reduces it by only “50% in India”. That was the point I was referring to in the second quote to which you refer. Please correct me if I have misinterpreted your model, but as I understand it, even when India and other poor countries which constitute the bulk of the world reach current OECD levels of development they will still be deemed to adapt only by 50% not by 90%?

I am sorry if you thought I was trying to misrepresent your model. Far from it. The clarity and transparency with which you present all your assumptions and equations stood out as a model which I only wish others on all sides of this debate would emulate. So I regret all the more that a proofing error – mea culpa – led to that impression.

Best regards

Peter Lilley

Stern exposed

Updated on Sep 4, 2012 by Bishop Hill

Updated on Sep 4, 2012 by Bishop Hill

Nicholas Stern is to blame.

When you see wind farms covering every hill and mountain and most of the valleys too, you can blame Stern. If you can't pay your heating bills, ask Stern why this has happened. When children are indoctrinated and dissenting voices crushed, it is at Nicholas Stern that you should point an accusing finger. When the lights start to go out in a few years time, it's Stern who will have to explain why.

Despite years of having mainstream economists pointing to the flaws in the Stern Review there has been an almost unanimous collective shrug from the media, more interested in climate porn than the wellbeing of their neighbours.

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Five degrees

So much reading to do and so little time to do it.

Bob Watson interview with Pallab Ghosh yesterday was interesting on many levels, not least the fact that the BBC put the great man up against their science journalist rather than the usual greens.  Not that it appears to have made very much difference.

Watson is retiring soon, although I don't doubt that he will continue to make his voice heard. The BBC interview seems to be his parting shot, and of course it is on climate change. When your legacy is the industrialisation of the British countryside, I guess you would want to get some justification on the table.

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Quote of the day

Who among us would choose to exchange modernity and its stupendous prosperity for whatever reduction in global temperature we’d enjoy had all the greenhouse gasses emitted over the past 250, 260 years never been released?

Don Boudreaux tries valiantly to bring a CBS radio host back to something resembling reality.

Keenan and the LIBOR scandal

A few days ago readers were discussing the apparently inability of anyone in the UK establishment to bring anyone to book for any misdemeanour whatsoever. In that vein, Doug Keenan's recent article in the FT seems rather pertinent. Although it's somewhat off-topic for this blog, covering the issues surrounding the recent LIBOR-fixing scandal, the themes of willful ignoring of evidence that might lead the truth being uncovered are obvious. The involvement of the former head of the UK's Committee on Climate Change, Lord Turner, only adds spice.

Update on Aug 10, 2012 by Bishop Hill

An extended version of the article appears here.

Keenan himself is interviewed on the BBC's World Business Report (from 5:10).

Gordon Hughes on the economics of wind power

Gordon Hughes has authored a submission to the House of Commons Energy and Climate Change Committee on behalf of GWPF. The subject is wind power. It makes for horrifying reading.

Meeting the UK Government’s target for renewable generation in 2020 will require total wind capacity of 36 GW backed up by 21 GW of open cycle gas plants plus large complementary investments in transmission capacity. Allowing for the shorter life of wind turbines, the investment outlay for this Wind scenario will be about £124 bilion. The same electricity demand could be met from 21.5 GW of combined cycle gas plants with a capital cost of £13 billion.

Or what about this?

Under the most favourable assumptions for wind power, the Wind scenario will reduce emissions of CO2 relative to the Gas scenario by 21 million metric tons in 2020 - 2.6% of the 1990 baseline at an average cost of about £415 per metric ton at 2009 prices. The average cost is far higher than the average price under the EU’s Emissions Trading Scheme or the floor carbon prices that have been proposed by the Department of Energy and Climate Change. If this is typical of the cost of reducing carbon emissions to meet the UK’s 2020 target, then the total cost of meeting the target would be £120 billion in 2020, or about 6.8% of GDP.

I don't think that anyone expects the committee to even bat an eyelid, let alone pay any attention.

The limits of carbon taxes

Richard Tol's latest discussion paper looks at carbon taxes and wonders just how much you get by way of emissions reduction if you stipulate that you are not going to increase the overall tax take. In some countries the answer is not very much - if your current tax take is low then you can only impose a small carbon tax. If you try to impose a higher tax in these countries, they will (theoretically at least) drop out and their emission will remain "out of reach".

Different levels of carbon tax are discussed -

a stabilization target of 650 ppm CO2 equivalent would require a carbon tax of $6/tCO2e, in all countries, on all emissions, of all gases. A target of 550 ppm CO2e would require a tax of $29/tCO2e, and a 450 ppm target would need a $143/tCO2e tax. These are the three price levels shown in Figure 3

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Yeo fights for his right to trough

Tim Yeo, the Tory MP who runs the House of Commons Energy and Climate Change Committee, is all over the newspapers this morning, in an ongoing war of words between his committee and the Treasury, who seem to be trying to reduce the amount of money handed over to green energy projects, much to the distress of the MPs. See the FT here, the Telegraph here, and Roger Harrabin here.  Yeo was also on Radio Scotland this morning apparently.

Interestingly, only the Telegraph sees fit to mention Yeo's various interests in green energy businesses and his chairmanship of the Renewable Energy Association.

Politicians cause another food crisis

The drought in America has had predictable knock-on effects on expectations of this year's harvest. There is certainly a sense of panic in the FT's report (H/T RP Jr):

The world is facing a new food crisis as the worst US drought in more than 50 years pushes agricultural commodity prices to record highs.

Corn and soyabean prices surged to record highs on Thursday, surpassing the peaks of the 2007-08 crisis that sparked food riots in more than 30 countries. Wheat prices are not yet at record levels but have rallied more than 50 per cent in five weeks, exceeding prices reached in the wake of Russia’s 2010 export ban.

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Your life in their hands

The House of Commons Energy and Climate Change Committee began its inquiry into the economics of wind power last week, taking its first oral evidence. It was a fairly typical set of witnesses, with the panels constructed to ensure that the desired answer was received. The only dissenting voice among the nine witnesses was Gordon Hughes, author of the GWPF report on the same subject.

It is strangely compelling viewing, with something of the air of a disaster movie. The idea that UK energy policy is influenced by a forum like this is quite terrifying. It's interesting to see, however, how the tone of the inquiry moves from the platitudes of David Kennedy of the Climate Change Committee, to the zealotry of Robert Gross of Imperial, before everybody rather seems to give way to Hughes' authority.

Mission impoverish

Christopher Booker laments the insanity of the UK government's policy on shale gas, with the headline summing things up rather well

You can’t have shale gas – it might halve your bills

It is an extraordinary thing when the main political parties agree that the way ahead is a the impoverishment of the electorate and transfers of wealth from the poor to the rich.