Comments by Geoffrey Styles Subscribe

On An Ill-Conceived Tax Idea

John, the law seems to be pretty clear on who has the power to tax. If the current administration could have figured a way around that, they wouldn't be introducing this obvious non-starter via a toothless budget submission.

The fact that even with gasoline prices back at pre-Iraq War levels there is no consensus on bumping up the gasoline tax by the relatively small amount required to plug the hole in the Highway Trust Fund--a hole largely attributable to HTF support of non-road projects--is as clear a sign as you could want that the Gas Tax remains a potent "third rail" in US politics. Hence, the President's back-door attempt to get oil companies to do what the government can't.

As I pointed out to Bruce above, after long study I am convinced that the long-term solution is to move away from gallon-based taxation and toward energy-neutral fees based on annual mileage or other metrics of usage.

February 9, 2016    View Comment    

On An Ill-Conceived Tax Idea

Bruce,

Many of your examples of "cross-subsidized" transportation systems have more to do with the relative operational efficiencies of largely legacy road vs. rail transport networks and would exist irrespective of the energy sources involved. (We might achieve a different mix if starting from scratch, but that's not realistic.) US rail freight already achieves efficiencies on the order of 400 ton-miles per gallon of diesel using modern diesel-electric locomotives. Further electrification is an option--you aren't the first to think of it--but converting over 100,000 miles wouldn't come cheap. European countries, with their much higher geographic densities, have always had an advantage in this regard. Just look at the track network comparisons involved: http://data.worldbank.org/indicator/IS.RRS.TOTL.KM

Wtih regard to transportation funding, I think you're confusing ends with means. The long-term goal should be move away from funding based on volumes of fuels we're trying to reduce through efficiency or phase out with new technolgoes. That means moving toward either more user-fee based funding, or even greater reliance on funds from income and other less-regressive (than fuel) taxes. A Telsa puts just as much wear and tear on the roads as the Mercedes or BMW with which it competes, and its owner should pay accordingly, one way or the other. 

February 9, 2016    View Comment    

On An Ill-Conceived Tax Idea

Keith,

Thanks for your response. Let's spare the crocodile tears for the oil industry. These are commercial enterprises, and their investors understand (or should) that they won't always earn record profits. However, the notion that adding $10 in tax to today's low oil prices would make any alternatives to oil economical is risible, when multiple years of $100 oil failed to do so. (Wind and solar benefit little from high oil prices, because they compete with other sources of electricity--less than 1% of which comes from  oil in the US--and are driven mainly by public policies like the PTC, ITC, and state RPSs.)

As for making US oil less competitive with Saudi and other foreign oil, your comparison only applies to oil used in the US, which accounts for a small fraction of Saudi and OPEC production. OPEC faces no similar taxes in its other markets. European countries tax the heck out of oil, but at the point of consumption rather than production. That happens to coincide with where most emissions occur. Other markets for OPEC, including many developing countries, actually subsidize oil consumption. We might even agree that such policies are counterproductive in many ways. 

February 8, 2016    View Comment    

On Has OPEC Lost Control of the Price of Oil?

I'm sure that is factored into their thinking, as is the reality of the scale of the transition you are describing, which will take decades to complete. We could debate the odds of its being complete at mid-century, but they are clearly less than 100%, and probably less than 50% barring some technology breakthroughs, especially in batteries. In the meantime, the global vehicle fleet exceeds 1 billion, all but a few million running on gasoline or diesel fuel (with a few % biofuel blended in.)

So if you are Saudi Arabia and are ranking your risks, I would imagine that competition from non-OPEC producers, especially shale--still in its infancy globally--tops worries about the market for oil shrinking dramatically any time soon.

December 31, 2015    View Comment    

On In Memoriam: Robin Fray Carey

Robin was a dynamo, and I will miss her creativity and vision. She helped lift my blog from obscurity and got me involved in this community in various ways. A phone call or email from her invariably led to something interesting.

I'd like to extend my sincere condolences to her family and many friends. Her untimely passing will leave a big hole in many lives.  RIP.

 

December 24, 2015    View Comment    

On A Grand Compromise on Energy?

Nate and Bruce,

Nuclear plus large hydro makes a perfectly good closed loop for electricity, with the challenges for mobility you note. However, a significant number of environmentalists wouldn't regard either of those sources as sustainable and would insist on "new renewables." Nuclear seems as sustainable as anything, to me. We aren't going to run out of fissionables before something better comes along.

As for biomass, it's fine on a modest scale. However, large-scale biomass is synonymous with deforestation and loss of biodiversity.

There is no perfect energy; there are only tradeoffs with hard choices.

December 18, 2015    View Comment    

On A Grand Compromise on Energy?

Rick,

It's certainly the case that most wind and solar hardware today is made in countries that are mainly fueled by fossil energy. That shouldn't be surprising given the global primary energy shares of oil, gas and coal. China, where with Taiwan > 2/3rds of all PV modules are produced, is a prime example. And even though wind turbine manufacturer Vestas's home country, Denmark, has a high penetration of wind electricity, around 80% of its total energy is still from fossil fuels.

One might argue that this is a result of legacy infrastructure, rather than any inherent requirement of such manufacturing. All you'd need would be a 100% available/reliable non-fossil energy system. An article from Third Way shed some light on what that would take with renewables, including "significant overbuilding of generation, costly grid upgrades and storage expansion, and a huge build-out of transmission." My take is that would be very expensive, and as such further constrain the growth of these technologies, overall. I.e., we can close the loop, but the loop would be smaller.

Perhaps building PV with coal-fired electricity is just a form of bootstrapping. 

December 17, 2015    View Comment    

On Shrinking the Strategic Petroleum Reserve

Agreed. However, the Bipartisan Budget Act of 2015 that included the SPR sale doesn't quite fit the partisan lens you suggest: Every Democrat in Congress voted for it. See: https://www.govtrack.us/congress/votes/114-2015/s294 and https://www.govtrack.us/congress/votes/114-2015/h579
November 25, 2015    View Comment    

On What the Congressional Hearing on Volkswagen Missed

When I see "$18 B is nothing" I chalk it up as an unintended consequence of spending $800 B to stimulate the US economy following the financial crisis. Even today $18 B is a lot of money, to anyone. It's roughly the GDP of a number of small countries like Iceland, Cambodia, Honduras and Gabon, and it is equal to or bigger than the annual budgets of entire government departments and agencies that are household names, like NASA, Transportation, Interior, etc. It's also a couple of years of VW's annual income after tax.

I don't know what the appropriate level of penalty should be, and I'm sure it will be big enough to smart, but if you're looking for something that will cause VW and the rest of its industry to think twice about doing something like this again, then it looks like the stock market, media and consumers have already delivered that message.

October 14, 2015    View Comment    

On What the Congressional Hearing on Volkswagen Missed

Bob, Probably low millions, but I don't have a better estimate at this point. If we're talking about mitigation, rather than a gesture, the biggest obstacle is establishing the average excess pollution per vehicle, and how many cumulative miles driven. The testing on a couple of cars was sufficient to raise a red flag with regulators and convince VW to admit to cheating, but no one could consider that a statistically significant sample of the 500,000 cars involved.
October 13, 2015    View Comment    

On How Shale Reduced U.S. Energy Risks from Hurricanes

Jim,

You're right, of course. I wasn't trying to capture the full societal impact of hurricanes, just expanding on an energy-specific comparison prompted by the anniversary of Katrina & Rita.

As for "draining the swamp" by tapping the thermal gradient, I wonder if we could ever do this on a scale big enough to reduce the input that drives hurricane formation and strengthening, without causing other, unintended consequences we'd regret. A microcosm of the challenges of geoengineering, I guess.

October 2, 2015    View Comment    

On The Fallout from Volkswagen's "Defeat Device"

The Financial Times "Lex" column published a snarky obituary for the "Small Diesel Car Engine" today: http://on.ft.com/1WvWzxn  (may require registration or subscription)

The implication is that there are insufficient degrees of freedom (power/torque, fuel economy/CO2 emissions, cost) to deliver what VW and other makers have promised for all but the larger, "luxury" diesel cars.

I tend to align more with the article's less-satiric subtitle: "The announcement of the engine's demise may be premature." VW has announced that it has a fix that it will be running by the regulators over the next month. Before passing judgment, let's see whether the result leaves these cars a) meeting EPA and CARB NOx limits and b) still cometitive on fuel-efficiency and drivability versus gasoline-powered cars. In the process we should gain some insight into whether VW's software trick was a matter of expediency, or reflected hard engineering limits on what the technology could achieve.

Even if a technical solution works out, small diesels in general and VW's diesels in particular now have a reputational hill to re-climb, at a time when competing CO2-saving technologies have advanced significantly compared to where they were in 2008. Convenience and range could still be crucial selling points for diesel, compared to EVs. The final judgment will rest with consumers, more than regulators.

September 30, 2015    View Comment