Review of Pickens on Leno

You can see the video here:

http://www.nbc.com/The_Tonight_Show_with_Jay_Leno/video/episodes/#vid=648021

Skip to the 35:00 mark, that’s when he stops doing his old man impression and gets to the Pickens Plan.

And of course, he started with the $700 billion lie, just like I thought he would. He said that he did the analysis ($700 billion and 70% of consumed oil is foreign) then went with his plan. If the analysis is wrong, which it is, what does that say about his plan?

Then he asserts that we (The US) is paying for both sides of the war, but doesn’t specify which war (Iraq? Afghanistan? On Terror?).

Then he states that the OPEC countries had revenues of $250 billion and now that’s $1.25 trillion. I’ll have to check that out in a bit to see if that’s correct or not.

Then he says “If you want to see where your money is going, go over to the middle east and look at those buildings.” Which contradicts his assertion that oil money is funding terrorism. If oil money is funding terrorism, then it’s not going to building Dubai. I’m pretty sure that terrorists, at least of the fundamentalist Islamic type, do not like Dubai, but they don’t bomb it because they’re Arabs and that would put a pretty big negative on their public opinion. It’s easy to stay popular if you’re attacking a foreigner, it’s less so if you’re attacking someone who looks and speaks like you. But that’s a different story that T. Boone isn’t going try and catch up.

But then he says that he “doesn’t criticize them, but that we’re to blame for the fix we’re in.” Which is a pretty big paradox he sets up. Does he think we’re funding terrorists through the middle east countries we import oil from? Or does he think that there’s nothing wrong with what the Middle East is spending their money on? But you can’t get both ways there.

He then goes into the plan where he says that we have an abundance of natural gas and his usual “it’s cheaper, cleaner and ours” routine he’s done many times before. They get into a little banter about how the US is the Saudi Arabia of natural gas, which is true. He doesn’t mention that there are other countries that have alot more natural gas than we do. What happens when the US runs out of our reserves?

The discussion then turns to municipal bus fleets, and T. Boone uses the opportunity to go after Dallas for considering to run their buses on diesel, about which he says that “clean diesel” is an oxymoron. Jay then compares using diesel like a drug dealer, where they give you the price low and then raise the price later. T. Boone agrees with that analogy.

And again, Pickens is wrong. It’s natural gas that’s historically “cheap”, though rising in cost along with gas. Here’s why. Oil is already been priced high, because we’re already using it as the main transportation fuel. If Dallas is struggling with the decision, already knowing that diesel has already hit the $5 a gallon mark, then what is it going to go from here? However, natural gas is increasing in usage and the price is where it is right now. But what happens in the future (which is what this discussion is all about) is when the Pickens Plan is implemented and everyone switches to natural gas? The price increases much more than diesel, which people switch away from. So it’s actually natural gas that’s like the drug. Which makes Pickens the drug dealer, in this analogy.

He then tops it off with a threat to move to Fort Worth because their fleet runs on natural gas. I’ll believe that when I see it.

Jay then mentions that it’s easy to convert cars to natural gas, though I don’t see anything in a cursory search of the internet that suggests easy (and this isn’t “change the oil” easy, we’re talking “replace the transmission”). 98% of car owners aren’t going to be able to do this themselves, which is more of a sign of the complexity of the situation than anything else.

But then T. Boone has the revealing moment of the interview. He states that “he’s focused on trucks” and gives some statistics on that. What he doesn’t mention that is that the reason he’s interested is because he has a giant financial stake in getting trucks to run on natural gas. He’s on the board of directors of Clean Energy Fuels Corp, a supplier of natural gas to fleet vehicles (trucks). If he can get his plan to focus on trucks, then his company can see a large increase in demand for his services.

And lo and behold, he’s mentioned countless times that he wants the federal government to FORCE fleet vehicles to run on natural gas. In fact, at the 38:41 mark, he almost lets this cat out of the bag. He says:

I want those trucks. And I want the government, and I want the administration coming in to—you know, I started this on July the 8th.

See, he almost said what he wanted to do was force companies to use natural gas. I’m sure it’s just a coincidence that servicing fleet vehicles is EXACTLY what his company does. No politicking there at all, no financial benefit to him personally. Nope, not at all.

They wrap up by Jay mentioning that it’s about a $1.50 a gallon to fill up natural gas. This might be true… if you live in Utah or Oklahoma. (It’s no coincidence that these are two major producing areas in the US). Otherwise, you’re seeing above $2 per unit.

And he ends up with a prediction of $200-300 a barrel of oil if we continue with our current consumption. Considering that we haven’t even reached his prediction of $150 a barrel that he said we’d reach this summer, I’d take this with a bit of a grain of salt.

He also never got around to covering the wind part of his plan, but that part also has as many holes in it as his natural gas plan. So it’s probably best not to take up more time, but he did run long on the natural gas part.

So overall, he used his folksy style to cover up a bunch of lies and self-interest for the show. And the worse part is that he probably wasn’t very entertaining to boot. But we’ll see if his book promotion tour brings up any interest in his plan or not.

How much land would be needed for the Pickens Plan to work?

But let’s give the benefit of the doubt to Pickens and say that wind could make up the difference. How many windmills and land would be needed for it to work?

From the graph in my previous post, we have a power deficit of 300,000,000,000,000,000 British Thermal Units. This converted to kilowatt hours is 87 921 325 000 000 kWh. You need to get capacity to figure out how much space is needed, which is in units of kilowatts so you divide by the number of hours in a year, specifically 8420. That means you need to have 10441962589 kW of capacity to get this much power in a year.

But wind turbines don’t run 24 hours a day, in fact, they only run about 33 to 50% of the time, so you actually need double the capacity, AT BEST, to get the capacity needed. So you really need 20883925178 kW to supply the power importation needs for the US.

How much land would this require? For that I went here and used their calculator. The end results:

To get the US off foreign energy, we would need 41,767,850 turbines, which would cover 10,441,962.5 acres. This is also 16316 square miles. Or nearly the size of Vermont and New Hampshire COMBINED. And this is just for the physical items of turbines themselves.

Using a different method, a rule of thumb is that one square kilometer can support 10 to 15 MW of capacity. So using the figure above, we’d get 20883925 MW. So dividing by the best case scenario of 15 MW per square km, we get 1392262 sq. km or 537555 square miles. This is approximately the size of Texas, Oklahoma, Kansas, Nebraska and half of South Dakota, including urban areas, highways, mountains, and water.

So when T. Boone says that the Great Plains is the Saudi Arabia of wind, you better believe it because if we’re going to use wind to get the US energy independent, the Great Plains will become one giant wind farm.

And this is under a BEST case scenario. Just for fun, lets use the lower end of the power estimates (under the cut):

How Much Does the Government Spend on Energy Subsidies?

Thanks to the Energy Information Agency, I get little email every once and a while alerting me to when they have produced something called “Energy in Brief.” So this week, I got one in the email called:

“How much does the Government spend on energy-specific subsidies and support?”

Jackpot.

And the answer to this question: $16.6 billion just in the past year. To put that in pork perspective, that’s 45 to 60 Bridges to Nowhere, depending on which figure you use (total price of bridge to nowhere or just the famous 2005 earmark). That’s right, we can connect 45 to 60 small towns with their airports for just how much the government gives out for energy.

And what does the government do with this money? Not much, by the EIA’s own accounting:

Have Subsidies Affected Prices or Production?

Between 1999 and 2007, the average real price of total energy per British thermal unit (Btu)3 consumed increased more than 80%. Meanwhile, total energy consumption or demand, including imports, grew by about 5%. Most subsidies and support to energy producers should stimulate supply; so too should higher prices and rising energy demand. Yet in 2007, the United States supplied roughly 72 quadrillion Btu from domestic resources, about the same amount as in 1999. This leaves the impression that energy subsidies had little effect on net domestic production other than to help prevent further declines. But the enactment of various production-oriented tax incentives in the Energy Policy Act of 2005 and subsequent legislation may have contributed to the slight increase in primary energy production over the last two years.

So as a result of billions of dollars in subsidies and tax incentives, the US might have had a slight increase in energy production. At least with the 45 to 60 Bridges to Nowhere, we would have ACTUAL BRIDGES, not possible things that people would be hard pressed to identify.

You’d think that because of T. Boone Pickens’ ad campaigns that we don’t do anything to support wind energy right now. And, like most things T. Boone Pickens says, this is pretty wrong. Again from the EIA:

Did You Know?
The estimated value of production tax credits to wind producers in FY 2007 was $666 million. The benefit was distributed over an estimated 27.7 million megawatthours, making wind power the largest beneficiary of production tax credits among all renewable technologies.

And this doesn’t even include other incentives given to wind producers that AREN’T tax credits, like direct subsidies. And this doesn’t even take into consideration that wind power DOESN’T produce much energy. So the per unit cost is an astronomical $.02/per kilowatt-hour. Considering that your energy bill is anywhere from $.08 to $.20 / kWh per unit, wind gets a subsidy that’s equal to 10 to 25% of your per unit costs. That sounds like it’s doing a whale of a job.

But believe it or not, wind ISN’T even the worse offender when it comes to government largess. That would be “clean coal”, which gets $2 billion to produce a tiny fraction of the energy in the US. But once again, clean coal and coal-to-liquids have huge backers in the Senate in the form of Robert Byrd and Mitch McConnell. And that’s money that’s not doing a lick of good.

So before we start heaping MORE money on renewables, a la the Pickens Plan, we should look to see what works and what doesn’t. Right now, wind and solar aren’t.

John McCain Uses the Pickens Lie

From John McCain’s acceptance speech last night:

My fellow Americans, when I’m President, we’re going to embark on the most ambitious national project in decades. We are going to stop sending $700 billion a year to countries that don’t like us very much. We will attack the problem on every front. We will produce more energy at home. We will drill new wells offshore, and we’ll drill them now. We will build more nuclear power plants. We will develop clean coal technology. We will increase the use of wind, tide, solar and natural gas. We will encourage the development and use of flex fuel, hybrid and electric automobiles. (Emphasis added)

I’ve documented the fact that $700 billion is a bald-faced, economically illiterate number that was conjured up by T. Boone that has no basis on the realities of the oil market or just plain facts. Add to the fact that McCain just lumped natural gas in with solar and wind (“one of these things is not like the other, one of these things is just not the same”), and T. Boone must have been jumping for joy with the speech last night. I’m sure one of the first things McCain will reach across the aisle to Nancy Pelosi is to force private fleet vehicles to run on natural gas.

So if you oppose the Pickens Plan, or don’t like the fact that it’s based on sketchy numbers, has a significant chance of screwing up our electricity market and backed by someone who has a huge financial stake in it, then you don’t have a choice in the election. Well you do, but you won’t hear about it in the media.

I would call on John McCain’s campaign to fully disclose their relationship with T. Boone and fess up to the fact that he cited a horribly incorrect number during a nationally televised speech. It’s the least that he can do “for the country.” But I doubt that will happen.

National Party Platforms on Transportation and Energy – Constitution Party

Continuing the series on party platforms on transportation and energy, we come to the Constitution Party.

They do not have a section on transportation issues, much like the Libertarians. They do have an energy section:

Energy

James Madison said: “The powers delegated by the proposed Constitution to the federal government are few and defined.” (Federalist Papers #45) The powers not delegated to the United States by the Constitution , nor prohibited by it to the States, are reserved to the States respectively, or to the people (Amendment X).

We call attention to the continuing need of these United States for a sufficient supply of energy for national security and for the immediate adoption of a policy of free market solutions to achieve energy independence for these United States. We call for abolishing the Department of Energy.

Private property rights should be respected, and the federal government should not interfere with the development of potential energy sources, including natural gas, hydroelectric power, solar energy, wind generators, and nuclear energy.

Pretty simple when you get down to it. Abolish the Department of Energy (much like the old Republicans, and no government interference. Pretty much a libertarian/free-market approach to energy.

I wish they would have something on transportation issues, but including everything risks having an unwieldy platform. It’s still an important federalist issue that would need to be addressed by any major candidate.

Stephen Spruiell on Energy & Environment on National Review Online

Stephen Spruiell on Energy & Environment on National Review Online

Sigh… is there any more reason to realize that Republicans made a huge mistake in nominating John McCain?  They’re going through all of these problems trying to square the platform with the candidate.  Of course, in a rational electoral system, the candidate would reflect the base and not have to be grafted together like “trying to write a lawsuit against yourself.”

But as a result, Republicans have now gone along with the environmental movement in calling all this “climate change” instead of “global warming.”  Which is a tautology, or some kind of logical infallacy, since CLIMATE IS ALWAYS CHANGING. Somehow, this society has become so narcissitic that the current climate SHOULD be the only climate on Earth for as long as humans remain here.  Try telling that to the people of North Africa, who have been screwed the past 1000 years or so with advancing desert conditions, which cannot be explained away in the past 50 years of industrial development.

So in continuing with my plan to review all of the party platforms, I’m pretty sure I’m not going to like what I see in the Republican platform when it is formally adopted next week.

National Party Platforms on Transportation and Energy – Libertarian Party

In a multi-part series, I am going to find and post the party platforms for all of the national political parties, concerning transportation and energy. Today I’ll start with the Libertarian Party.

2008 Platform

Nothing on transportation. On energy, they have this to say:

2.3 Energy and Resources

While energy is needed to fuel a modern society, government should not be subsidizing any particular form of energy. We oppose all government control of energy pricing, allocation, and production.

Short and to the point. But this has it’s good points and its bad. You can boil down the Libertarian platform to “free markets good, government intervention bad”. Which is pretty much what they did this year. Even to the point, that they don’t even have a stated position on transportation.

Of course, it isn’t to say that they’ve never had a position on transportation. They even had a position on public utilities once upon a time. That’s something only a policy wonk would love, but framed the right way, the Libertarians could even put this in a winning message:

“You know why you pay $80 a month for 200 cable channels you don’t watch. Government policies don’t allow you to pick and choose the channels you want to watch, even though the technology is available. You can choose an individual plan for your cell phone, but the government forces everyone to have a one-size fits all plan for cable. It’s time to take cable out of the hands of bureaucrats and lobbyists and back where it belongs, the customer.”

So as an idea of where Libertarians stand on more complex issues, below is the 2004 Libertarian Party platform on some key issues.

New Anti-Pickens Graphic

In light of my questioning of the $700 billion figure quoted by Pickens and perpetuated by… everyone else, I’ve “modified” one of the badges used by Pickens to help spread his plan.

I’m happy to take suggestions on how to improve the graphic. There are other of Pickens’ badges that I would like to correct, and I will post those in the future.

Pickens Plan a Bridge to Gore Plan

From Bloomberg:

While Pickens views his own proposal as a “bridge to where Al wants to go,” there are no plans now to coordinate.

“He asked if we could we join together and do something; I told him no, because global warming is on page two for me,” Pickens, founder and chairman of Dallas-based BP Capital LLC, said. “Page one is foreign oil.”

“There are some pieces where they might differ,” Gore spokeswoman Kalee Kreider said. Gore’s “feeling is they have more in common than the elements that might separate their proposals.”

I’d like to see where reliable energy is on Pickens (or Gore’s) pages. Somewhere near page 387, I’m guessing. So if there’s some brownouts or blackouts (the equivalent of Lenin’s “If you want to make an omelet, you must be willing to break a few eggs), then so be it. So what if our economy devolves into something seen in Africa, just so long as it is clean energy.

Just remember that whenever you see or hear “The Pickens Plan”, just substitute “The Gore Plan” instead.

Weekend Post – Obama Doubles Down on Stupid Ideas

Just when I thought Obama might just leave well enough alone and just encourage conservation through words, he comes out with six pages of emphasizing the really bad part of his strategy to give the appearance of his caring for high gasoline prices.

An “Emergency” Economic Plan by Obama

Here’s just a rundown of the faults:

• Another stimulus/rebate check. This time $500 a person. This time paid for by a 5 YEAR windfalls profit tax. This isn’t temporary, it’s permanent. And what happens if there aren’t “windfall profits” four or five years from now?
• $50 billion slush fund in the form of two congressional pork troughs, a direct grant to states and a “jobs and growth” fund.
• He asks for a “reasonable share of profits”… reasonable by what definition of the word
• Obama completely ignores economics. McCain has at least admitted his ignorance on the issue, but Obama’s is completely ass-backwards in terms of economics. Imposing a tax 5 years from now is just going to make prices higher NOW and IN THE FUTURE. Suppliers are going to cut back on supply (because they can, and why take a tax hit now when you can wait 5 years and get all of the profit on pumping oil), and that’s going to raise the price of oil.
• Then there’s Obama’s construction slush fund. This is going to be spent well, and there’s absolutely no room for corruption with having $25 billion to throw around on roads and school construction.

Now, I wouldn’t have a problem throwing money at road construction, except Congress has ZERO credibility in spending the money it has now. Where was all the construction when oil prices were low (lower asphalt costs) and consumption was high (greater revenues)? Oh yeah, being sent for study upon study and mass transit systems. And not for these critical repairs Obama says are needed.

I’m now currently reading Henry Hazlitt’s “Economics in One Lesson”. It covers many of the topics involved here, including taxation and public works. Perhaps Obama should read the first 50 pages and see where that takes him. Probably nowhere, but then maybe he won’t put out drivel like this proposal.