Weatherdem's Weblog

Bridging climate science, citizens, and policy

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Gasoline Usage Still Way Down YoY; Oil Prices Rising

According to NDD at the Bonddad Blog, Year-over-Year gasoline usage in the U.S. remains significantly negative: 8167 M gallons this year vs. 8810 M gallons last year this week.  That’s -7.3%.

Yet oil prices increased this week by over $4 to $103.24 per barrel and gas prices at the pump rose $0.04 to $3.52 (national average).

Let ‘s state this clearly: it’s not American demand driving those prices up.  We can attribute part of the increase to other growing economies.  But as more people are figuring out all the time, a not inconsequential part of it is commodity speculators.  Then there’s tension over Iran that the Republican Teabaggers are trying to inflame – they just love them all the war and conflict they can gin up (as long as their family members aren’t required to actually serve, dont’cha know).  Finally, don’t discount the role of the giant fossil fuel industry here – do you think they’re taking the Keystone pipeline decision in peace?

As the folks at Bonddad Blog state, oil and gas prices this high helped act like a choke collar on the U.S. economy last year.  Given the relative growing health of the economy since, and the similarly growing prospects for Obama’s reelection largely as a result, that collar might be forcefully reapplied (or no action taken by some to remove it) in order to dim his electoral chances.

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Choices: Fuels, Efficiency, Transit vs. Drilling

I keep writing that we as a society and a species have choices that we’re continually making today that will affect the climate of tomorrow.  Most choices involve spending some small outlay of money today in order to not have to spend much larger sums just to adapt tomorrow.  The choice I’ll write about today deals with one of the Republican Teabaggers’ favorites: gradually use less fossil fuels in our transportation sector or “Drill, bagger, drill!”  As usual, the Teabaggers are on the wrong side of the issue, as this chart from the NRDC, using data from the Energy Information Administration shows:

The black line on top would be the pathetically measly result of opening up new drilling areas to the dirty energy corporations: less than 1 million more barrels of oil per day by 2025.  Real energy independent, eh?  Aside from the fact that oil corporations will sell that oil to whomever will buy it most expensively (i.e., not in the U.S.), three of the other measures would prevent the use of the same amount of oil by themselves.   Combined with other measures, the total number of barrels of oil that wouldn’t have to be bought and used is 5x the amount made available by opening up new drilling areas.

The results of using 5 million fewer barrels of oil per day by 2025 can’t be understated: less environmental damage in all aspects of the drilling process; real steps toward energy independence; freedom to keep more money in Americans’ pockets (isn’t that what Teabaggers are supposed to be all about, anyway?); more efficient transportation system.  And on and on it goes.

Going the drilling route couldn’t be more stupid.  This choice, as is the case for others, is pretty simple.

[h/t MB @ dKos)

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The American Power Act – First Reactions

The Senate’s version of climate and energy legislation was formally introduced yesterday.  Titled “The American Power Act”, the draft is 987 pages long and includes darn near everything.  Reading any substantial amount of the bill is going to take a while; understanding it will take even longer.  Of course, by the time activists read and understand it, it will probably be in the process of being modified.  Regardless, here are two links that I’m looking at.  The first is the full bill; the second is a section by section summary.

S1733- The American Power Act (pdf)

21 page Section by Section summary (pdf)

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Energy News Tidbits: EVs & Oil

European countries made a decision following the 1970s when OPEC held the world hostage for oil.  They decided they were going to diversify their energy portfolios and reduce the impacts that OPEC would have on their economies.  Renewable energy has found quite the secure home across Europe.  Their problems aren’t completely solved today, but they’re far closer than we in the U.S. are.

In the past few years, a push for electric vehicles has taken root in Europe.  Spain wants 1 million hybrid or electric cars on its roads by 2014.  25,000 charging stations could be in England by 2015.  France is building a national network of charging stations.  Europe is in the growing stages of a race to deploy electric carsThe U.S. continues to lag far behind European countries in fuel economy standards because our domestic auto manufacturers’ executives stuck their fingers in their ears and made fun reality as it passed them by.

Overall, investing in electric cars is up.  Charging stations, regardless of country, will have to be built.  Standards will have to be decided upon.  Our past decisions will heavily and negatively impact our ability to lead the world in future decisions.

Back to OPEC – one of the deciding factors on the acceptance of electric vehicles will be the availability and thus the cost of oil.  World oil reserves are likely only 2/3 that reported by the oil cartel.  With that much of a discrepancy, even $2.80 gas is underpriced.  When shortages appear in the upcoming years, price shocks will result because of OPECs unwillingness to tell the truth.

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Economic Numbers Come Out Just Prior to 2008 Election

What will their effect be?  I think they will act as a final reminder to folks that the cons’ economic policies need go no further.  People do want change.  They want to be able to afford their groceries, their gas and their healthcare.  None of them are more affordable now than they were 8 years ago.  They want to have money to retire with and they have seen their pensions and 401k’s eviscerated by the cons.  The numbers that were released today show nothing different than what we’ve seen over the past six weeks.  Here they are:

The economy shrank at an annual rate of 0.3% from July through September.  The previous quarter’s number was +2.8%, but you can’t really compare the two.  Remember, the 2nd quarter saw all the economic stimulus checks beings sent out and spent.  It was a one-time deal and that’s confirmed by the 3rd quarter number.  Without those stimulus checks, the 2nd quarter GDP numbers were likely closer to 0.  Economists are predicting the next two quarters will likely be negative also.  We’re already in a recession.  Most Americans have come to this conclusion, I think.  I doubt we’ll get confirmation of it from the cons, however.  Bush’s crew is likely to let that announcement slide to an Obama administration.

Jobless claims for the week again totaled nearly 500,000.  Unemployment is September was reported at 6.1%, but is expected to increase in the months ahead, possibly to 8%.  Unfortunately, the official unemployment number neglects some aspects of the true labor market.  The actual unemployment number is probably a couple percentage points higher.  Tack on underemployment and the actual condition of labor can be assessed – it’s likely to be 12% or greater.

Here’s a headline that should surprise no one: State budget gaps widening as economy slumps.  As a result of the insane tax policies of the cons, the federal budget has been over-allocated.  That has left state budgets stretched thin during the “expansion” of the previous decade.  There wasn’t an expansion and services were required to cover additional people.  Something has to give.  Either the tax-zealots win and services disappear or taxes are raised and services survive (at lower strength perhaps).  This illuminates the biggest problem with cons’ economics: if public services are halted, people will be forced to buy services from the private sector.  Umm, real wages haven’t risen in more than 8 years.  Where exactly are people supposed to get the money to buy those services, because their cost will assuredly increase (that’s what happens in a capital economy, after all).  When people vote, they need to think about how they want to pay for services.  If everybody invests in them with tax dollars, the government can provide them at a low cost.  If everybody is on their own, the private sector will provide them at great cost.  Which means those providing the services will get richer while the rest of us get poorer.  Or people will just be plain unable to get those services.  Services that include education; health care.  How about the police and fire deparments?  Should those be privatized?


Let me present one more economic number: Big Oil Profits for the 3rd quarter.  Remember, the economy went into the crapper, hundreds of thousands of people have lost their jobs and foreclosures are happening at record numbers.  Along with all of that, ExxonMobil once again posted the largest 3-month profit in human history, beating their own record set in the previous quarter.  Just how much did Exxon make in 3 months?  $14.83 billion.  What was their record last quarter?  $11.68 billion.  How about during the 3rd quarter last year?  $9.41 billion.  Did your income go up 58% in the last year?  Because Exxon’s did.  How about 27% more in July-September than April-June?  Exxon did.  And that is only 1 oil corporation – only 1!!  That’s what $4.00 gas did this past summer: it stuffed the pockets of the most profitable corporations even further.  Remember the Exxon Valdez oil spill in 1989?  They finally paid some money on that disaster: $170 million.  That’s only 1% of their profit in the last three months.  Pathetic.  Immoral.

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Additional Economic Figures: Fuels, Unemployment and Housing

As Congress works to pass an immoral bailout of corporatist gambling, activities continue across America.  Demand for fuels was down again in August by about 4% versus last year.  Of particular interest to me was the stockpiles of gasoline stockpiles: they’re down to the lowest level since 1990!  This has gotten no play in the corporate media while House Dems capitulated on off-shore drilling: refineries were operating at only 67% of capacity.  That’s correct: only fuel corporations have refineries operating at only 2/3s of their possible maximum.  What’s the price of gasoline again?  It’s still $3.50 a gallon?  I don’t wonder why.  Do you?  Or more accurately, why does anyone still think that doing nothing about global warming will cost less than doing something?  150 platforms were destroyed since Aug. 2005.  Here’s the ultimate laugher with respect to off-shore drilling: if platforms are being wrecked by moderately strong hurricanes, what incentive do fuel corporations have to build new ones?  Let me complete things here: lack of refining capacity is what has held product from the market, not lack of drilling space.  Even then, refineries aren’t operating where they should be.  Opening up areas off-shore will not decrease the price of gas.  Ever.

More people filed for jobless benefits last week than any time since Sep 2001.  Unemployed people do not expand economies.  Is anyone delusional enough to think that the $700 billion bailout will propel corporations to hire more people?  They won’t.  People will remain jobless, people will continue to lose their homes, which means the bailout will fail.  That means our economy will be in terrible shape for quite some time to come.  And Republicans will be only too happy to point their fingers at everyone else.  Unfortunately, Democrats have left a golden opportunity to properly cast con-servative economic policies as immoral and insane.

Existing home sales fell again last month.  They were down 10.7% compared to a year earlier.  Banks are holding on to all their capital because every bank knows every other bank issued as much crappy debt as they did.  No money flowing between banks means no money in the system.  That brings the system to a screeching halt.  If Congress were to send any portion of the $700 billion they’re handing over to mega-corporations to the citizenry, the wheels of our economy would receive a much needed boost of grease.  Bush’s corporate cronies know they’re causing the system to collapse and they have the audacity to demand a bailout from Americans.  Simply disgusting.


[Update]: MSNBC has an article up citing two of the above and adds a third: manufacturing orders plunged again last month.  The same article says existing home sales were expected to fall only by 1%.  That’s pretty damn far from the 10%+ actual drop.  Good thing economists are more trusted than weather forecasters.  I’d hate to see what would happen if economists were ever wrong…

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Climate and Energy Tidbits 8/31/08

So far this year, the oil and coal corporations spent $427 million on lobbying Congress and advertising. Every one of those dollars could have gone to building oil refineries, which would increase the supply of oil and gas. Or they could have gone to carbon sequestration research. Instead, they went to ensuring our addiction to oil and coal would continue for years to come. Solutions to this problem are available.

Xcel Energy will relay potential costs of doing business once legislation is passed that accounts for climate change to shareholders.

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Pickens and Schultz: Wind, Natural Gas and Climate Change

So T. Boone Pickens has a new commercial about his grand plan to save us from foreign oil. Wind power is his leading pitch, which given the source should worry all of us. What he’s not touting too loudly in his commercials is the switch from oil to natural gas. And there are reasons he’s not proudly trumpeting that part of it. He’s one more ultra-rich conservative who is trying to make even more money off the rest of us and is too cowardly to fully explain everything up front publicly. Sure, he keeps pointing folks toward his plan on his website. How many people are going to check it out though? What he’s selling on-air and what his plan actually includes are too close to two different things to sell me on it.

Today, Ed Schultz talked extensively about the commercial and the subject. It sounded to me like Ed is ready to take Pickens’ proposal and run with it. His stance is founded from the thought that weaning ourselves off of foreign oil is worth implementing Pickens’ plan. I can respect Ed for having his opinion, but I’m going to share why I think it’s misguided. Here’s the main thrust: are we overly dependent on foreign oil? Yes. Is that the biggest problem facing us this century? Not by a long shot. Climate change easily dwarfs whatever discomfort we’re currently feeling with the price of gas. We currently have the choice to adjust to higher gas prices. Climate change will leave us with an decreasing list of choices to make. And the longer we wait before we tackle it with everything we’ve got, the more expensive in financial and sociological terms it will be.

The wind energy portion of Pickens’ plan is a good idea. Everybody should be climbing on the bandwagon to increase renewable energy development, in both large and small projects. Of course, the larger the better.

It’s the natural gas portion of his plan that makes absolutely no sense. Why would we shift natural gas from electricity generation to transportation? There are two huge problems with the concept. One, natural gas is burned with 3-4X more efficiency in electricity generation than it would in vehicles. Using natural gas for transportation would just waste most of it (80-85%). Based on this then, natural gas should replace dirtier kinds of electricity generation. Coal is the dirtiest form currently used. A moratorium on new coal plants should be implemented nationally. Any plants that are new or would replace a coal plant should produce fewer dangerous emissions. Natural gas is a positive step in that direction. It’s not the final destination by any means, but it would help lower the rate of CO2 emissions going into the climate system in the short- to medium-term future.

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Republicans Continue to Prove They Love Only Oil Businesses

Big Oil’s profits have been nicely padded in recent years by the billions in corporate welfare (tax dollars) given away by the Republican-led Congress earlier this decade. Republicans like to crow how they’re pro-business and Democrats aren’t. It’s been patently absurd the entire time, but voters have let them get away with it. Just as egregious, Republicans have stalled and stymied similar credits for renewable energy companies, none of whom are even remotely as large as Exxon, Conoco and others. Providing tax credits to renewable energy development companies in a timely fashion (they expire every few years) lets investors know that they won’t be left holding the entire bag. These small companies’ existence and growth is largely dependent on the credits to provide stability to attract the large sums of up-front capital until their market is mature. This process doesn’t happen overnight, after all.

So how pro-business are Republicans? Pro-business enough to block a vote to extend the renewable energy tax credits prior to their August recess (by the way, when was the last time you got a solid month off?). All we hear in Colorado if the giveaway to corporations is shifted in any way is businesses will fail and jobs will be lost. Well, apparently the only businesses Republicans seem to care about are the Big Energy kind. If the tax credits aren’t extended by the end of this year, 116,000 jobs and $19 billion in investments are at risk.

Republican Senators decided prior to the second year of this Congress that they would work to prevent as much work as possible from being done. Then they would run on a “do-nothing” Congress, a description they earned themselves when they controlled things. So far, they’re succeeding at the work prevention part of their plan. They’ve threatened to filibuster a record number of bills this year, and the Jobs, Energy, Families, and Disaster Relief Act of 2008 is no different. Democrats couldn’t get 60 votes to move forward on the bill.  By the way, there is a really good resource about this (and any other) bill: OpenCongress – S.3335.

Gov. Bill Ritter and every other governor in the U.S. sent a letter to Congress a week and a half ago requesting those tax credits be extended. That’s right: 50 governors, from every part of the political spectrum, recognize that small- and medium-sized businesses in their states are at risk of going out of business because a mere 40 Senators decided to block Congress’ work.

Republicans aren’t pro-business and this is only one example that proves that. Businesses supported this bill and wanted it passed. It turns out that Republicans are more ideologically driven than that. They wanted amendments attached that would expand areas where oil and gas drilling could occur. That’s despite the fact that doing so wouldn’t mean drilling actually would occur. Or that if it did that oil and gas prices wouldn’t be reduced for another 5-10 years. Or that states like California and Florida would prohibit drilling off their coasts even if the Congressional ban were lifted. None of that means squat to Senate Republicans. They’ve held up this bill despite the fact that a majority of Americans: Democrats, Unaffiliateds, and Republicans alike, favor renewable energy development more than they favor off-shore drilling.

No, none of that matters. Why? Because Big Energy super-greases Republican campaign coffers. Staying in office means more to these chumps than securing our energy future. You know what? We can do something about that. There are 23 Republican seats that are either being vacated or challenged this cycle. 11 are easily within reach of Democratic takeovers. Help get those Democrats elected so Republicans don’t have 40 easy votes to block everything over the next two years. They’ve demonstrated they only care about their office and not the policies they were sent to enact. Get rid of them and send morally responsible Senators to work for you.

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Big Energy Continues to Enjoy Record Profits

In an announcement that surprised absolutely no-one, energy corporations continues to set records for quarterly profits.  The heavyweight, ExxonMobil, reported profits of $11.68 billion in three months.  Demand starting falling earlier this year.  It’s taken a while for oil and gas prices to follow, and they certainly haven’t fallen by similar percentages, but profits are still skyrocketing.

I wanted to spend some time discussing the language of the CNN-Money article.  One sub-headline reads: “Pricey oil cuts both ways”.  The richest among us continue to try to throw a pity party for themselves.  The only thing that results from high oil prices that oil corporations have to buy is their profits are less than they otherwise would have been.  The rest of us should be grateful that Exxon only made $11.68 billion.  It could have made even more!

In an attempt to parry criticism levied at corporations like Exxon, more articles like this one are starting to include descriptions of “where the money is going”.  The article touts the $7 billion Exxon spent on finding and producing more oil.  Interestingly, production still fell 8% from year-ago levels.  $7 billion just doesn’t get you what it used to, I guess.  The real problem isn’t locating new oil – corporations know where plenty of it is.  It’s the lack of refining capacity in the U.S.  Remember, a new refinery hasn’t been built in 30 years.

The article mentions $10.1 billion went to shareholders in dividends and stock buybacks.  It goes on to bring up all the taxes Exxon and others have to pay.   Waaaaaah!

In terms of governmental policy, the corporate welfare Exxon and others are enjoying should be shut down.  With demand continuing to increase and corporations working to keep supply down, their profits will continue to set records.  Why should the American taxpayer give them more of their hard-earned money?

Another point on corporations locating new oil and wanting more off-shore areas to be opened for lease: when will the corporate media bring up the fact that the Gulf of Mexico was opened up for leasing two years ago?  Oil and gas prices have shot up ever since.  Where’s the oil?  Where’s the relief at the pump?  The answer is easy: corporations are sitting on those leases, which helped cause the increase in price and thus in their profit.  Corporations have no real interest in increasing supply.  They’re sitting on a resource that is dwindling and they know it.  If Congress is stupid enough to open off-shore areas, prices will not go down.  The facts in the past two years bears that out.  It sounds really good right now while we’re all paying more than we ever have for gas.  The best way to bring down prices in the environment set up by the big energy corporations and their lackeys in our government?  Decrease demand.


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