Thursday, October 20, 2011

The peak oil brigade is leading us into bad policymaking on energy | Dieter Helm

2:25 AM | Posted by Free Game Zone | | Edit Post

We can not assume the price of energy goes up. The real problem is that the fossil fuel may be too little or too much

almost always a mistake to assume that you know where energy bills are ongoing. This is especially true for secretaries of state, and energy policy should not be based on the assumption that you know what the future holds. Unfortunately, there is the new conventional wisdom and a common assumption in much of Europe.

However, Chris Huhne, the UK Secretary of State for Energy and Climate Change, it is certain that the price of oil and gas are still in place, which will be volatile and a Central to this policy is to protect British industry and consumers of the consequences. This is a case study of renewable energy and nuclear energy: If the price of fossil fuels will be more expensive than renewable energy and nuclear power is relatively cheap. Add in energy efficiency, then we can predict that energy bills will fall if these technologies are compatible.

The last time politicians do not know what was the last time oil prices peaked - in 1979. Oil peaked at $ 39 a barrel (about $ 150 at today's prices). It was assumed then that oil prices always go up, and the entrance to the Conservative government launched a plan to build a nuclear reactor a year for 10 years. Instead, prices collapsed in mid-1980, and did not return to 1979 prices on a quarter-century (even with the two Gulf Wars).

Since then, leads us to believe that fossil fuel resources are limited and knowledge of the world, and that peak production has already reached or will be soon. The gas is expected to follow the oil. In short, we're running out of fossil fuels and thus get (much) more expensive. For supporters of peak oil, the truth is that convenient decarbonisation by renewables and nuclear power is not only good for the climate, but the economy seems too. Almost all of this is absurd - and some of them is dangerous nonsense. Not enough oil and gas (and coal as well) to fry the planet several times. The problem is that fossil fuels may be too large nor too small, and that fossil fuel prices might be too low, not too high.
  • The crust is full of fossil fuels. The question is not whether there is a shortage of material, but the costs of removal. Until recently, the abundance of cheap oil in conventional places like the Middle East has limited incentives to seek more, and in particular to go after non-conventional sources. However, technological change was motivated by the need - and the revolution in shale (oil shale and now, too) was a transformational experience in the United States, one of the largest markets in the world Energy
new technological developments from time to enter the markets and customers do not feel the benefits of a good time. But it would be wrong to assume that will not end. Worse, it would be wrong for the design of energy policies to protect against price volatility so that if gas prices fall, they are not allowed to reap the benefits.

is also wrong to think renewable energy and nuclear will pay for themselves - and so will be cheap alternatives (but then at least be able to get rid of subsidies). It was finally the real weakness of the Stern report, and why politicians fell over themselves to cite its GDP than 1% of annual costs to combat climate change. Customers were led to believe they would do them harm, and therefore, were happy to support green policies. But now they realize it is not true, and the reaction started. The real risk is that of having been deceived by the politicians, are beginning to doubt the veracity of climate change.


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