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Friday, July 18, 2008
Pickens on the Energy Crisis
Pickens has a vested interest in the wind plan since he is a major investor. But knowing that background, it's still valuable to consider his suggestion. I thnk the inclusion of NG as a transportation fuel has real merit.
I was only able to watch the first half so I may not be fair. Three quick comments.
1) Wind is a joke. It will turn out to be a complete waste of money as was burning corn.
2) Price of oil is mentioned at the beginning and our dependence on foreign oil. That is IMO a non-argument. The issue is not where the oil comes from and never has been. That is smoke and mirrors. The issue is whether or not we have the freedom to get our own oil to be competitive with the market. Freedom is the key. Importing oil may be better if their prices are better.
I say import more if the price is better than what is produced locally. This whole we are 4% and consuming 25% of the oil thing is just silly.
3) Natural Gas in cars has been tried. The market just doesn't support it. It is another idea that only works if government subsidizes it. Also, the price of Natural Gas won't support his idea. I have personally pulled many gas meters in the last several years. Perhaps if we had a huge supply and every gas station had the ability to sell NG we could do this, but the regulations for such an idea would never allow it. I don't think it would anyway. The logistics would be too difficult (unless he knows something I don't). So again, the market wouldn't support it. If it could, it would have done so.
I'm not arguing from an adversarial pov, but my responses would be:
1) I'm initially inclined to agree with you, based on the cost of wind turbines and the amount of electricity they produce. It would take many series of wind farms to make an appreciable dent in the energy supply.
2) Well, oil is a global market. But anything we can do to bring up global supply would tend to lower the price of crude. And it does matter how much wealth we are transferring abroad. While total energy independence may be merely a dream, the degree to which we do not rely on imports enhances our security and our balance of trade. The transfer of wealth alone is alarming. But I agree with you about the so-called moral argument of 4% and 25%.
3) But we don't have a free market in energy now. The oil and gasoline industries have enjoyed decades-long preferences and subsidies. Of course no other transportation energy source has been able to compete and of course the market isn't there for them. Is there anything inherent to NG that would make it impractical if the playing field were leveled?
2 comments:
I was only able to watch the first half so I may not be fair. Three quick comments.
1) Wind is a joke. It will turn out to be a complete waste of money as was burning corn.
2) Price of oil is mentioned at the beginning and our dependence on foreign oil. That is IMO a non-argument. The issue is not where the oil comes from and never has been. That is smoke and mirrors. The issue is whether or not we have the freedom to get our own oil to be competitive with the market. Freedom is the key. Importing oil may be better if their prices are better.
I say import more if the price is better than what is produced locally. This whole we are 4% and consuming 25% of the oil thing is just silly.
3) Natural Gas in cars has been tried. The market just doesn't support it. It is another idea that only works if government subsidizes it. Also, the price of Natural Gas won't support his idea. I have personally pulled many gas meters in the last several years. Perhaps if we had a huge supply and every gas station had the ability to sell NG we could do this, but the regulations for such an idea would never allow it. I don't think it would anyway. The logistics would be too difficult (unless he knows something I don't). So again, the market wouldn't support it. If it could, it would have done so.
God Bless
I'm not arguing from an adversarial pov, but my responses would be:
1) I'm initially inclined to agree with you, based on the cost of wind turbines and the amount of electricity they produce. It would take many series of wind farms to make an appreciable dent in the energy supply.
2) Well, oil is a global market. But anything we can do to bring up global supply would tend to lower the price of crude. And it does matter how much wealth we are transferring abroad. While total energy independence may be merely a dream, the degree to which we do not rely on imports enhances our security and our balance of trade. The transfer of wealth alone is alarming. But I agree with you about the so-called moral argument of 4% and 25%.
3) But we don't have a free market in energy now. The oil and gasoline industries have enjoyed decades-long preferences and subsidies. Of course no other transportation energy source has been able to compete and of course the market isn't there for them. Is there anything inherent to NG that would make it impractical if the playing field were leveled?
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