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Fossil Fuel is Subsidised
Posted: 05 May 2010 11:38 AM   [ Ignore ]
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There is an interesting article about subsidised fossil fuels.

Between 2002 and 2008 the United States spent 72 billion dollars on fossil fuel subsidies, but only 29 billion dollars on renewable energy resources—nearly 17 billion dollars of which went to corn-based ethanol, an agricultural fuel that many environmentalists argue is not carbon-neutral and has been linked to deforestation and food crises.

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Posted: 05 May 2010 12:52 PM   [ Ignore ]   [ # 1 ]
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not to mention untold billions spent (and yet to be spent in the form of medical care for those involved) on the two Gulf Wars wink

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Posted: 07 May 2010 05:10 PM   [ Ignore ]   [ # 2 ]
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If politics would have agreed on a global tax of 1 cent per barrel since the 50’s now we would have been driving flying cars ... etc. because of fusion ... The truth is that the big money does not want it ... yet , since it is too cheap and it endangers their existing billions size investments.

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Posted: 31 May 2010 05:59 AM   [ Ignore ]   [ # 3 ]
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A country that has really big stakes in energy costs is Japan.  It spends hugely on very advanced breeder fission and imports all of its hydrocarbons.  Relieving that financial and resource pressure might finally break it out of its stagnant holding pattern economically. I would think they will be all over FF technology like white on rice when it comes out!  Thousands of FoFues ... hundreds of thousands!!  surprised  LOL  cheese

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Posted: 31 May 2010 06:15 AM   [ Ignore ]   [ # 4 ]
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The hydrocarbon markets are doing unexpected things anyway:

Indeed, Daniel Yergin, chairman of IHS Cambridge Energy Research Associates, the energy consultancy, calls the growth of shale gas “the most significant energy innovation so far this century.’’

He explains that as recently as 2007, it was widely thought natural gas was in tight supply and the US was going to become a growing importer of gas.

“This outlook as been turned on its head by the shale gale,’’ he says.

ExxonMobil’s $41bn deal late last year to buy XTO Energy, the shale specialist, shows that the industry recognises the potential.

Indeed, European energy companies, such as BP, Total and Statoil, have been investing in US shale for several years.

In recent months, Asian sovereign wealth funds also have moved in, as expectations grow that the US government will increasingly turn to natural gas as a way to reduce carbon emissions.

The effect is global:

Gazprom had hoped to win up to 10 per cent of the US market, mainly sourcing supplies from the Shtokman field where it plans to develop LNG. But now these plans have turned out to be “wishful thinking”, according to Valery Nesterov, energy analyst at Troika Dialog.

The changes so far to its long term export contracts, however, might not be enough to maintain market share in Europe, Mr Stern says, as other producers such as those in Norway – which have offered more flexible terms for sales – continue to increase sales compared with Gazprom.

“They think they have solved it. But the way I see supply and demand they will still have problems,” he says. The gas group is indeed still in talks with its European energy partners on possible further changes to contract terms to make them more flexible. “This is a normal process,” says one person close to the group.

Part of the problem for Gazprom is that in previous years, it had been used as a tool to help achieve Vladimir Putin’s geopolitical ambitions, industry executives say.

As president, Mr Putin had overseen a period of empire-building by Gazprom that saw it lock in supplies at market prices from Central Asian producers to head off potential competition from the European Union, while also attempting to increase its hold over European markets – where it has traditionally supplied about 25 per cent of the continent’s imports – via the building of North Stream and South Stream pipelines.
...
The latest and most compelling example, analysts say, was Mr Putin’s recent proposal Gazprom merge with its Ukrainian counterpart, Naftogaz Ukrainy. Analysts said the proposal, which Ukraine has yet to agree to, was a blatant power play that would give Russia control over the “commanding heights” of the Ukrainian economy, but would significantly add to Gazprom’s already debt-burdened balance sheet.

Gazprom’s position is not to be envied. It must weigh having to boost investment in complex, logistically challenging new fields in the Yamal Peninsula against uncertainty in global markets.

It must continue investing because its production at existing fields is already in decline with the company itself forecasting output will drop from a maximum capacity of 600bn cu m to 400bn cu m by 2020. “There is always a concern about a turndown in demand,” said one person close to the gas group. “But it is the same people that two years ago said give us more gas who are now saying we don’t need any. In today’s situation no one can predict anything,” the person said, pointing out that other industry executives in the West are still warning of a supply gap in 20 years.

Against this backdrop, Gazprom’s negotiations with China on a big new supply deal are becoming increasingly important, as markets are expected to grow at a much faster pace there than in Europe.

Igor Sechin, Russia’s deputy prime minister for energy, recently said he expected a sales agreement to be reached by September this year. But talks on price have been going on for years. And “even if there is deal, it is going to be at least five years before gas flows to China,” Mr Stern says. “It is not going to solve the problems.”

...

The fall in US prices caused by the surge in gas production from unconventional sources such as shale rock appears to have put a cap on British prices. If the UK price rises too high, LNG cargoes that would have gone to America are diverted to Britain instead.

Many analysts have worried that the continental European market, which is less liquid, transparent and competitive than that of the UK, and is dominated by long-term contracts with prices linked to oil, might force up UK prices, as the oil price has recovered since February 2009.

Instead, the opposite appears to have been the case, with continental European companies such as Eon and GDF Suez using the availability of cheaper gas priced on the spot market in Britain as a bargaining tool against Gazprom, the Russian gas export monopoly, to force it to concede greater flexibility and lower prices in its contracts.

“The sudden emergence of shale gas as a global driver on gas supply and prices means that security of supply concerns are certainly dormant and possibly dead,” says Nick Grealy, an energy analyst who runs the No Hot Air website.

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Posted: 31 May 2010 06:27 AM   [ Ignore ]   [ # 5 ]
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And India, which is booming, now has its own shale gas:

Indeed, India may need no gas deals at all with Gulf countries for a long time. Gas from the Krishna-Godavari offshore basin is going to flow in huge quantities in the next few years, making India self-sufficient. New gas deposits are constantly being found offshore.

Besides, India also has massive shale deposits, and should give priority to exploiting these over sinking billions into a highly dubious pipeline through Pakistan. Reliance Industries Ltd has been the first to grasp the new opportunity. It has just bought a 40% stake in the operations of a US company, Atlas Energy, in the Marcellus Shale, a huge deposit extending from New York to West Virginia. Reliance is looking for maybe two more shale gas acquisitions in the US, and Essar Oil will probably follow suit. The ONGC, as always, is slow off the mark, but will lumber into this game soon.

Between NG now and FF later, the Gulf states and the Peak Oilers are going to be feeling very betrayed by Ms. Reality Bites.  LOL  cool grin

It should be noted that it hardly matters where in the globe the gas is found; any new gas displaces purchases that would have been made, which means those supplies have to go looking for cut-rate buyers elsewhere. In other words, hydrocarbon energy is fungible.  Which many Greenies don’t get, and hate it when they do get it.  It means that attempts to price-squeeze the world into energy submission are doomed.

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Posted: 05 June 2010 02:22 AM   [ Ignore ]   [ # 6 ]
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Definitely this is a burning issue, but there is a more sharper look of the picture, by looking from this angle we can save & then spend billions of saved $s in needed areas.

As a nation we are spending two much on individual carrier owner,  we must try to adopt a habit of using Bi-Cycles, definitely one can argue the workability of this idea, initially we can use bicycles for

      Domestic Work.
      Going to College.
      Going to Gyms.

Initially this idea may look little foolish but if one from every one of our homes is willing to give it a try for at least one month the big saved money at the end of month will please us and our great nation can quickly went through this phase of economy.

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Posted: 05 June 2010 06:25 AM   [ Ignore ]   [ # 7 ]
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zavier.f - 05 June 2010 06:22 AM

Definitely this is a burning issue, but there is a more sharper look of the picture, by looking from this angle we can save & then spend billions of saved $s in needed areas.

As a nation we are spending two much on individual carrier owner,  we must try to adopt a habit of using Bi-Cycles, definitely one can argue the workability of this idea, initially we can use bicycles for

      Domestic Work.
      Going to College.
      Going to Gyms.

Initially this idea may look little foolish but if one from every one of our homes is willing to give it a try for at least one month the big saved money at the end of month will please us and our great nation can quickly went through this phase of economy.

I love biking, but this is not tiny little Europe.  Distances are much larger, and I’m D****D if I’m going to bike in the rain to save energy and money!  Much less snow. I did all that with 40 lbs. of newspapers in heavy duty carriers plus cloth bags when I was a kid 50 years ago. That was enough!

Anyhow, FF is going to make energy surplusses, so don’t sweat it.

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Posted: 05 June 2010 09:15 AM   [ Ignore ]   [ # 8 ]
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That is great to heard a comment so early.

Actually we are living in USA, and in US if the Americans able to just alter there traveling habit specially the areas in which i pointed out, then surely there will be great savings for us .

Regards

Zavier Francis.

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Posted: 05 June 2010 02:21 PM   [ Ignore ]   [ # 9 ]
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zavier.f - 05 June 2010 01:15 PM

That is great to heard a comment so early.

Actually we are living in USA, and in US if the Americans able to just alter there traveling habit specially the areas in which i pointed out, then surely there will be great savings for us .

Regards

Zavier Francis.

It’s appropriate only in small towns and cities, and in the right weather, and with very limited cargo. Very unlikely to have much effect. The US is too large to become a bicycle commuting nation.

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Posted: 05 June 2010 04:48 PM   [ Ignore ]   [ # 10 ]
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That is right USA is too big to be commuted on bicycle, but what i am suggesting, if one is going to Gym for workout and Gym is happened to be at few Km distance he or she must prefer to ride his or her own bicycle, by doing so he or she could be benefited in two ways health and saving of hard earn money.

These benefits can be gained if we all ponder for a moment or so.

Regards,

Zavier Francis

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Posted: 10 June 2010 10:53 PM   [ Ignore ]   [ # 11 ]
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Brian H - 05 June 2010 06:21 PM
zavier.f - 05 June 2010 01:15 PM

That is great to heard a comment so early.

Actually we are living in USA, and in US if the Americans able to just alter there traveling habit specially the areas in which i pointed out, then surely there will be great savings for us .

Regards

Zavier Francis.

It’s appropriate only in small towns and cities, and in the right weather, and with very limited cargo. Very unlikely to have much effect. The US is too large to become a bicycle commuting nation.

Expansion of public transit would tend to unburden the energy expenditure for commuters. The trouble with that, in the U.S., is that many places were designed with the assumption that people will drive a car, even to cross the street, to get to the local mall, instead of walk through a tunnel, or take a bus or train. Manhattan is an exception, of course, and exemplary of urban planning that makes efficient use of space.

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Posted: 11 June 2010 03:49 AM   [ Ignore ]   [ # 12 ]
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Manhattan is certainly an exception, but as the loyal US citizen every one of us should work on my suggestion to improve the health and increase his/her saving.

Regards,

Zavier Francis

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Posted: 13 June 2010 10:44 PM   [ Ignore ]   [ # 13 ]
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Recent figures show each of Britain’s wind turbines earned, on average, £138,000 in subsidy last year. $200,000 US!

Each turbine. gulp

With the markup from selling the electricity they produce they make about £300,000 per year per turbine, almost 50% tax payer subsidised.

Perversely the subsidy isn’t location specific. There are lots built in Lincolnshire for example where planning consent is easier to obtain than elsewhere. It also has very little wind.

One commentator said “These aren’t just wind farms – they’re subsidy farms.”

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Posted: 14 June 2010 10:37 PM   [ Ignore ]   [ # 14 ]
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Phil’s Dad - 14 June 2010 02:44 AM

Recent figures show each of Britain’s wind turbines earned, on average, £138,000 in subsidy last year. $200,000 US!

Each turbine. gulp

With the markup from selling the electricity they produce they make about £300,000 per year per turbine, almost 50% tax payer subsidised.

Perversely the subsidy isn’t location specific. There are lots built in Lincolnshire for example where planning consent is easier to obtain than elsewhere. It also has very little wind.

One commentator said “These aren’t just wind farms – they’re subsidy farms.”

The commenter misspoke.  He should drop the word “just”.

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Posted: 15 June 2010 01:13 AM   [ Ignore ]   [ # 15 ]
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There are some challenges involved in subsidizing renewable technology.
If installations are subsidized, then they can be build cheap/low quality and in non-competitive areas.
If energy price is subsidized then energy from non-renewable sources can be repackaged as renewable to game the system.
Ending fossil fuel subsidies, creating a carbon tax (or other system) and letting the market adjust itself would probably slow down the economy.

Still I wonder on what scale is the system being gamed, I would expect it to be a pretty modest amount as most of the people should be fair and others would not want to get caught.
Also the subsidies are being reduced already, because they did their job of starting up this sector:
http://www.renewableenergyfocus.com/view/7865/germany-reduces-solar-subsidy/

Of course in case FF comes online I will know which sector to short in the first place.

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