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Monday message board

November 27th, 2006

It’s time, once again for the Monday Message Board. As usual, civilised discussion and absolutely no coarse language, please.

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  1. wilful
    November 27th, 2006 at 08:01 | #1

    The Victorian election was desperately unsurprising. I’m not at all surprised by the result – though there was an expectation that the Greens would do a little better, and the entrenching of Family First at about 4% is a new face on the block. Overall though, it looks like 2014 before the Libs can look towards getting back into power. A long time between drinks and with no candidates with any government experience.

    The thing is, it appears totally irrelevant whether it’s Libs or Labor – the crappy populist policies of the Libs would be dropped soon after forming government, and the two parties are otherwise essentially indistinguishable.

  2. November 27th, 2006 at 08:03 | #2

    For some months I been abusing the hospitality of this Monday board to build my theory that international oil prices were manipulated to try and help Bush’s GOP in the US mid-term elections. Readers may be interested to read the final (?) analysis on my blog here. And just to show what a whacko Conspiracy Theory it is, it’s been picked up by Joshua Marshall at AlterNet here.

    Thanks very much to those on this blog who provided helpful input.

  3. Joe
    November 27th, 2006 at 09:00 | #3

    Scott Adams has an interesting post on bringing home the troops, and decision-making, at http://dilbertblog.typepad.com/the_dilbert_blog/2006/11/complicated_dec.html

  4. November 27th, 2006 at 09:15 | #4

    Interesting to see that Peter Garrett made a few enemies by campaigning actively against the Greens. A lot of people seem to think he was playing dirty and simply telling fibs like he is a politician or some such thing.

    http://www.xenoxnews.com/index.php?name=News&file=article&sid=1716

  5. November 27th, 2006 at 09:37 | #5

    Kevin Rudd calls AWB the worst corruption scandal Australia’s history and warns that our “long-term foreign policy reputation is at stake”:

    “The government got 35 sets of warnings over a five-year period that the AWB was up to no good and the government, at a minimum, is guilty of negligence and not responding to any one of those warnings.”

    Hear, hear!

  6. November 27th, 2006 at 10:22 | #6

    Meanwhile, in New Zealand, watergate

    Good analysis here

  7. Mike Smith
    November 27th, 2006 at 10:54 | #7

    In recent debates/arguments concerning nuclear vs coal vs other power sources, I’ve heard the proposition advanced that alternative power sources can not currently, and will not in the near future, contribute to base load power generation. I haven’t, however, heard anything much other than this assertion or its contrary.

    Can anyone offer, or point me to, a credible evaluation of this proposition?

  8. November 27th, 2006 at 14:26 | #8

    Mike Smith – “In recent debates/arguments concerning nuclear vs coal vs other power sources, I’ve heard the proposition advanced that alternative power sources can not currently, and will not in the near future, contribute to base load power generation.”

    The term “Base Load” is very misunderstood. The power plants that do base load are typically coal and nuclear that cannot change their output quickly and are much more economical to run continously. As these plants cannot change output rapidly they are termed base load.
    http://en.wikipedia.org/wiki/Base_load_power_plant

    If you mean 24 X 7 power no matter what then renewables without storage cannot do this. Some of the major problems base load has interfacing with renewables is their inability to change output in response to fluctuating supply. Also all the base load is not required at off peak times. One of the main reasons that utilities sell off-peak power so cheap is that they have these huge coal plants still running at almost full speed however not generating electricity. You can’t switch them off because it takes days to get back to speed so you have to run them whether you are generating power or not.

    There will always be a requirement for 24 X 7 power. However because base load plants do not interface well with rapidly changing grids with lots of renewable power we need to move away from 19th century technology and replace thermal coal with Integrated Gasification Combined Cycle plants that gasify the coal that is then burnt in combined cycle gas turbines. Gas turbines can supply 24 X 7 power but can also change output rapidly and automatically and are vastly more suited to future power grids. Solar and wind can also make flammable gases like hydrogen, and hydrogen reacted with CO2 methane, to fuel these power plants and can be stored in vast quantities for when the sun is not shining and the wind is not blowing.

    Finally there are now economical options like vanadium batteries to add direct storage capability to renewable power making it more intermediate class power and smooth out some of the fluctuations. A mix of renewables (solarPV, solar thermal, wind, wave tidal) geographically dispersed also increase the capacity factor of renewables. Further in the future are the plans that I favour to replace oil fuelled transport with battery electric transport and use these batteries in a 2 way system called Vehicle to Grid to store electricity.

    Before any of this is done we need to reduce our power demand by using less and using what we have more wisely by being more efficient.

  9. November 27th, 2006 at 14:30 | #9

    India’s Finance Minister:

    “We could have actually grown by 9-9.5 per cent, but for the increase in oil prices,” he said at the India Economic Summit, organised by the Confederation of Indian Industry (CII) and the World Economic Forum, here today.

    “There has been no change in demand and supply. How did prices fall from $78 to $58 per barrel? We must come to terms with the fact that oil producing countries are exploiting developing countries. The world needs to come to a sort of understanding on this issue,” he felt.

    Maybe he should read my blog.

    [/end self-promotion]
    [but seriously...!]

  10. November 27th, 2006 at 14:40 | #10

    Mike, this study, put together by a group called Energy Probe, dedicated to opposing nuclear power, has a study of the power generation patterns from Canada’s wind turbines.

    The short version – the capacity factors are even lower than hoped, the output is highly variable, and it doesn’t correlate particularly well with peak demand – and, as they concede themselves, the backup power has to be supplied from low-efficiency fossil-fuel peaking plants.

    As to energy storage, aside from pumped hydro and compressed air (which are both limited in scope) there isn’t a good solution available. The state of the art in general-purpose large-scale energy storage is flow batteries, which cost about $150 per KwHr of storage in large installations according to this blog post. I did the sums and I figured that 12 hours of energy storage is about the same capital cost as nuclear power plant systems of equivalent capacity (which generate electricity about 90% of the time), using the rather conservative 2000 USD/kW nuclear construction cost our gracious host favours.

    What most green groups are really arguing for, in the short term, is a program of energy conservation and limited renewables deployment, but by far the largest fraction of their greenhouse gas reductions come from the substitution of coal with gas. Which is sort-of OK, until every country on Earth tries the same thing and the price of natural gas skyrockets. See the report linked from this post on my blog.

  11. November 27th, 2006 at 15:04 | #11

    Obviously I would disagree with Ender on the economical nature of vanadium flow batteries at the present time.

    Ender, one thing I’d like to correct you on is the peaking nature of combined cycle. Combined-cycle plants (be they fired by natural gas or coal gasification or for that matter biofuels) feature two cycles – a gas turbine and a steam turbine. Steam turbines generally aren’t particularly keen on being started up and shut down, as I understand it.

  12. November 27th, 2006 at 15:11 | #12

    Robert Merkel – “The short version – the capacity factors are even lower than hoped, the output is highly variable, and it doesn’t correlate particularly well with peak demand – and, as they concede themselves, the backup power has to be supplied from low-efficiency fossil-fuel peaking plants.”

    As usual when people say renewables you take the example of just wind. Do you think that Australia’s power demand could be met with just thermal coal and nothing else? No peaking plants or anything – no of course it couldn’t. No more can a renewable solution just rely on wind. It will take a combination of all renewables to achieve a more reliable renewable supply.

    “I did the sums and I figured that 12 hours of energy storage is about the same capital cost as nuclear power plant systems of equivalent capacity (which generate electricity about 90% of the time)”

    Where are the sums? What assumptions did you use? Nuclear power should include a fuel fabrication plant plus a waste disposal facility. 2 billion dollars for the plant plus 5 or 10 billion for fuel and waste buys a hell of a lot of storage. Lets say 10 billion dollars so that is at 10 000 000 000 $150 = 66 666 666 kWh of storage which is 66 GWh which is the output of nuclear power station for 66 hours or nearly 3 days. This is more than enough buffer in the system for 70% penetration of renewables without having to baby sit 30 tons per year of HLW for a thousand years.

  13. November 27th, 2006 at 15:54 | #13

    Ender, you know perfectly well why I discount solar at the present time.

    The “breakthrough” solar plant the government was trumpeting is budget to cost $420 million dollars and generates roughly $4 million dollars electricity at average wholesale rates – maybe more like $8 million if you count the premium for renewable credits.

    There are proposals that might be of some use – geothermal, perhaps, or perhaps some of the ideas for airborne wind turbines in the jetstream.

    I’ll post my calculations in a later blog post, but it didn’t count the cost of a fuel fabrication plant or a waste disposal facility. If you count the total operating costs of a nuclear plant they are tiny (including fuel), compared to the cost of buying power from wind farms or solar panels.

    As for waste storage, the nice thing about it is that you accumulate money for 50 years (actually, you could do it indefinitely while storing the waste in casks, but that makes people unhappy). In any case, the total costs estimated in the Switkowski report were in the order of $1 million dollars per tonne of HLW disposal.

  14. November 27th, 2006 at 17:37 | #14

    Robert – again you are still thinking large solar when solar rooftop PVs and solar hot water heating can make significant contributions with the correct incentives. The solar plant is a concentrating solar PV plant not solar thermal. This site gives some idea of the levelised costs of different technologies:
    http://www.energy.ca.gov/electricity/levelized_cost.html
    Solar thermal is about USD$0.17/kWh with significant cost reductions for volume manufacturing possible.

    “If you count the total operating costs of a nuclear plant they are tiny (including fuel), compared to the cost of buying power from wind farms or solar panels.”
    Are you joking here? What about security, maintenance regulatory upgrades and problems? A wind farm especially with the newer variable speed turbines, that do not have gearboxes, is almost install and forget.

    “As for waste storage, the nice thing about it is that you accumulate money for 50 years (actually, you could do it indefinitely while storing the waste in casks, but that makes people unhappy). In any case, the total costs estimated in the Switkowski report were in the order of $1 million dollars per tonne of HLW disposal.”

    As nobody has successfully buried HLW in a geological repository yet such estimates are the sheerest fantasy. Yucca Mountain will cost an estimated:
    http://archives.cnn.com/2002/ALLPOLITICS/07/10/yucca.mountain/index.html

    “By a vote of 60 to 39, senators voted to override Nevada Gov. Kenny Guinn’s veto of the Energy Department’s decision to move ahead with the underground storage facility, which is projected to cost $58 billion and could begin receiving nuclear waste from across the country by 2010.”

    You can accumulate money for as long as you like however the costs will also accumulate as you pay more and more to temporarily store it on site at approx 30 tons per year then pay the transport costs to wherever the waste site will be. Then pay a very patient and long lived person to guard it for longer than the Roman Empire lasted.

    That the other think I cannot work out. If nuclear waste is so safe and easy to store why the hell is it always put somewhere a long long way from anybody? Why should people in NT, who don’t use the electricity generated from the waste, have it stored in their state. Surely the ideal spot is a disused coal mine etc close to where the waste is produced like in western NSW.

  15. November 27th, 2006 at 18:11 | #15

    Ender,
    The reasons it would be put in the NT are simple – the political backlash would be slight (the federal government can over-ride NT legislation simply and there are only a few federal members are from there) and the geology is stable, with some of the oldest rocks on the planet. Turn it into glass, put the stuff a couple of kilometres underground in 2 plus billion year old rock and cover it with concrete and the chances of it coming back up again before the Earth is swallowed by the expanding Sun a few billion years from now is substantially lessened. They are not zero, conceded, but much closer to zero than many other options.
    Coal mines in Northern NSW are bad for a few reasons – lots of voters, lots of Senators, not as geologically stable and fairly shallow.

  16. November 27th, 2006 at 20:11 | #16

    Andrew – “Turn it into glass, put the stuff a couple of kilometres underground in 2 plus billion year old rock and cover it with concrete and the chances of it coming back up again before the Earth is swallowed by the expanding Sun a few billion years from now is substantially lessened.”

    If it is that easy why have the US taken 15 years and billions of dollars to do nothing so far? Who pays for turning it into glass, drilling 2km into the earth and excavating a cavity to take the waste? The NT has groundwater problems that can leach radionucleides. There is no data on leaching and no-one can predict the long term stability of such materials because they have not, and cannot be tested for the timescales needed.

    Why not just avoid the problems and ditch nuclear power altogether?

  17. November 27th, 2006 at 20:28 | #17

    Because, in a sensible analysis you do not exclude anything through prejudice, you look at them all and make a call based on the facts.
    Anything else is just wilful ignorance – the worst type of ignorance, IMHO.

  18. November 27th, 2006 at 20:59 | #18

    Nuclear fuel is made by mining naturally occuring radioactive materials and concentrating them into a more pure form. The waste product from nuclear energy is a concentrated form of radioactive material. It always seemed reasonable to me that disposal should involve dilution and dispersal, perhaps by crop dusting the desert or the oceans with the stuff.

    I think flow batteries like the Vanadium Redox battery offer a lot of promise. However they have not yet proved to be a roaring commercial success. As I understand them they involve losses of about 15% over the storage and release cycle, which is tolerable but expensive.

  19. Hermit
    November 27th, 2006 at 21:06 | #19

    Dare I suggest that the nuclear waste disposal problem hasn’t been addressed decisively because it is not really urgent at this point. Somebody will have a patch of deep, dry, stable rock to rent out to all comers and will make a motza. I have no opinion on tidal power, nonvolcanic geothermal, vehicle-to-grid or whether batteries can store a gigawatt-hour of energy other than the fact these ideas have barely gotten past demonstration stage so far. Nuclear has. I do think early evidence points to clean coal being a dud and the two Beas (Beazley & Beattie) should stop incanting it. As everybody but the PM is saying put a price on carbon immediately and see what happens.

  20. November 27th, 2006 at 21:46 | #20

    Terje – “It always seemed reasonable to me that disposal should involve dilution and dispersal, perhaps by crop dusting the desert or the oceans with the stuff.”

    What like fallout?

    “As I understand them they involve losses of about 15% over the storage and release cycle, which is tolerable but expensive.”

    Just transmitting the power involves losses of 10% we tolerate that OK. 15% is really quite good – pumped hydro is far worse.

    Hermit – “Dare I suggest that the nuclear waste disposal problem hasn’t been addressed decisively because it is not really urgent at this point”

    No it is urgent in the US they just do not make a big thing about it.

    http://www.ens-newswire.com/ens/apr2004/2004-04-05-01.asp
    “When nuclear fuel can no longer sustain power production for economic or other reasons, the spent fuel is removed from the reactor and placed in a spent fuel pool. There the hot radioactive spent fuel is cooled for at least one year, and generally five years, before being put into dry casks, the NRC says.

    The need for alternative storage space has increased as spent fuel pools reach their capacity, and a permanent geological repository at Yucca Mountain, Nevada is still not operational.

    Dry casks, which are heavily shielded containers used to store radioactive material, are currently being used for interim storage in 24 of the 103 operating U.S. nuclear power plants, and their use is expected to grow in the near future. “

  21. November 28th, 2006 at 08:46 | #21

    As I wrote elsewhere, the news of privatisation just keeps getting better and better. Check out the article ‘No-rise’ Telstra rings in changes by Michael Sainsbury in today’s Australian:

    Telstra raised prices for international text messages from 35c to 50c last week, and assured The Australian at the time there were no further fee increases on the way (my emphasis).

    Now the telco will introduce the new charges for customers on contracts with its networks. Telstra will raise the charge for retrieving voice messages to 60c per minute from 32c per minute. But Telstra has taken off a small charge for lodging messages.

    For Telstra users, the flagfall will increase by 2c, meaning some users will pay 37c before they speak – the highest in the market. Optus charges users on contracts 25c for flagfall.

    Note the justification for the latest cost impost:

    Telstra cited its recent investment of more than $1billion in building its new third-generation mobile network as a reason for the price rises.

    I don’t call Trujillo telling customers that they were going to have to pay, with increased charges, for the Next G service at the time he announced its commencement on 9 October. Nor did he mention how the perfectly good GSM network that was now used by hundreds of thousands of rural Australians was to be junked, which, in turn, replaced the analogue network which was junked in 2000. He did not tell Telstra’s customers that they would now be forced to throw their GSM handsets onto the same junk pile on which they had previously thrown their analogue handsets and buy a Next-G-capable handset from Brightstar, a “a company owned by a business associate of chief executive Sol Trujillo and operations chief Greg Winn, and which got its contract without any open tender,” according to Michael Sainsbury in the article “Telstra should hear dealer alarm bells” in The Australian of 23 October.

    And let’s not forget that Next G was offered to the Australian public in lieu of its scrapped FTTN fibre-optic broadband network.

  22. November 28th, 2006 at 08:56 | #22

    BTW, the article “Telstra should hear dealer alarm bells” of 23 October referred to above, can be found here.

    The Sydney Morning Herald has also reported the mobile phone price hikes in the article Telstra to lift mobile charges in today’s edition.

  23. November 28th, 2006 at 11:30 | #23

    (I expect that some may see the implications for the discussion on Peak Oil of November last year.)

    Mexican Oil production has peaked

    From the ASPO-USA newsletter

    The CEO of Mexico’s state oil company, PEMEX, said the company expects production from its giant Cantarell oil field to decline by an average of 14 percent a year between 2007 and 2015. Cantarell is expected to have an average daily production of 1.8 million b/d in 2006 down from a record 2.13
    million b/d in 2004. PEMEX is currently producing around 3.29 million b/d down from 3.38 in 2004. About 1.7 million b/d is exported, mostly to the US.

    Mexico says it will need to start spending $18 billion per year on exploration and development of new oil sources in order to offset anticipated declines in oil and natural gas production. Deep-water oil from the Gulf is Mexico’s most promising new source but will require foreign assistance to exploit.

    The government has become addicted to PEMEX earnings and currently takes 60 percent of PEMEX’s revenue which now constitute nearly a third of the national budget. In 2005 PEMEX sustained an operating loss of $7 billion.

    It is unlikely that PEMEX and the Mexican government can find the revenue to finance heavy exploration costs over the next ten years. President-elect Calderon, who takes office on December 1, has stepped carefully around the sensitive subject of energy reform, and while he favors allowing PEMEX to form alliances for deep-water oil and refining, he hasn’t called for a
    constitutional amendment to open up the industry.

    Should Calderon be unable to pass some sort of energy reform in the next year, it seems unlikely that Mexico will be able to continue exporting oil to the US at the current rates much longer. While the government is claiming that Cantarell is going to decline at 14 percent a year, there is evidence that the decline could be much faster.

  24. November 28th, 2006 at 11:48 | #24

    Correction: “perfectly good GSM network” in the above post should have read “perfectly good CDMA network”, the latter being the network set up to replace Telstra’s analogue network, which was itself junked in 2000 under tath notorious agreement designed to entice Vodaphone to set up in Australia, whislt the former has ben the network used by mobile phone customers in urban areas.

    Presumably teh GSM network, together with the CDMA network, is to be junked and all current Telstr mobile phone users will be forced to buy a handset ultimately from Brightstar.

  25. November 28th, 2006 at 11:49 | #25

    James,
    At the risk of repeating myself – do you see any reason why I should not point out that the problem in Mexico could be that the government owned oil monopoly (PEMEX) may not be competent to handle their oil industry? That cutting out foreign money means that they cannot explore the areas properly?

  26. November 28th, 2006 at 12:33 | #26

    Ender,

    Yes like fallout but widely and thinly spread. Coal fired power stations currently produce radioactive fallout that we tolerate. I would suggest that any deliberate form of dilute fallout should be more widely spread than that from coal fired plants.

    Storing nuclear waste in a concentrated form seems to be a bigger menace.

    Regards,
    Terje.

  27. gordon
    November 28th, 2006 at 18:22 | #27

    In July this year, the UK Govt. released “The Energy Challenge: Energy Review Report 2006� (The Wicks Report) . This report canvassed the future role of nuclear energy in the UK and included analysis of nuclear costs relative to conventional and renewable power sources. Curiously, the Switkowski report nowhere seems to mention the Wicks report, which is odd considering the considerable overlap between the two reports and the fact that new modelling of relative generating costs was done for Wicks. This must have been just about the most recent modelling available before the Switkowski report was written, yet Switkowski was content to use older modelling results culled from the literature by the Electric Power Research Institute (EPRI) (pp. 45, 119 of Switkowski). Switkowski relies chiefly on an MIT study of 2003 and a U. of Chicago study of 2004 to arrive at his cost estimates for nuclear (p.45).

    The reports diverge over the cost of nuclear. Wicks suggests that the cost range of nuclear electricity is $A75 – $A112.5 per MW/hr. (p.189; estimating from graph using an exchange rate of $A1 = 40p.), whereas Switkowski’s range is much lower at $A40 – $A65 per MW/hr. (pp. 45, 47). Both reports seem to concentrate on the same types of reactors – light water reactors – which Wicks refers to as “evolutionary third generation nuclear technologies used worldwideâ€? (p.183).

    Why the divergence? Switkowski’s range of A$40–$A65/MWh is essentially based on a single study – the 2004 U. of Chicago study identified by EPRI (see graph on p.47 of Switkowski). That study expresses values in 2003 US dollars. Using an exchange rate of $A1 = $US0.75, Switkowski’s cost range for nuclear becomes $US30 – $US48 (Obviously, this is not exact – it would be necessary to find the 2003 exchange rate then adjust the $A value for inflation to 2006). The closest approximation to these values in the U. of Chicago study is in Table 15, where a range of $US31 – $US46 is found. But Table 15 can’t be the source of Switkowski’s range, because that table shows costs assuming a raft of Govt. subsidies, none of which are mentioned in Switkowski’s report.

    I can only invite other commenters to see if they can find the origin of Switkowski’s cost range in the U. of Chicago study or anywhere else. People who have access to historical exchange rates and price deflators obviously have an advantage. I can’t offer a prize, except perhaps for the empty title of “Mole of the Year�.

  28. gordon
    November 28th, 2006 at 18:27 | #28

    The Wicks Report is here. Look down the list of publications for “The energy challenge. Energy review report 2006 [Cm 6887]“

  29. gordon
    November 28th, 2006 at 18:30 | #29

    This is weird. One more time: The Wicks Report

  30. gordon
    November 28th, 2006 at 18:31 | #30

    I must be tired. The Wicks Report is here

  31. gordon
    November 28th, 2006 at 18:34 | #31

    I am under a curse. An intelligent person can find the Wicks Report, full title “The Energy Challenge:
    Energy Review Report 2006″ on the DTI reports and publications site.

  32. November 28th, 2006 at 20:16 | #32

    Gordon,
    I will part way to that title. Using the rates at Oanda you get the usual range of values – 2003 had a fairly high variability between AUD and USD, so at 1 Jan it was 0.5615, 31 December – 0.7247, and the average through the year was 0.6525. If we take inflation since then as 2% (roughly right) the resulting table I cannot do in HTML, So I will do my best to make this look right.
    AUD Price Average 1-Jan 31-Dec
    40 27.70 23.83 31.82
    65 45.01 38.73 51.70

    At 2003 average rate and inflation corrected, therefore, the USD range is $27.70 to $45.01. This is not going to be correct, though, as much of the kit for a nuclear reactor and associated requirements would be bought in either USD or EUR (at today’s rates) with some of the labour costs being in AUD, some in USD, some in EUR, shipping fees, insurance etc. etc. etc. and would need to be adjusted for all of that and more. Not something I want to try without someone paying me a large fee.

  33. November 29th, 2006 at 07:31 | #33

    Andrew Reynolds,

    I posted the story about the seemingly imminent irrevocable decline in Mexico’s Oil production because I worry greatly about the question of the overall decline in the world’s supply of oil and how it will affect everybody’s future, or, indeed, even allow us to have a future. The fact that yet another source of oil for the US economy will start to decline from next year has obvious implications for the price of oil here and, as a consequence, all sorts of dire economic implications at the very least. Judging from the very little substance that you have ever contributed to discussions on questions related to the environmental and natural resources, it seems to me that you would spend very little time of any day giving seriously consideration to these issues.

    Andrew Reynolds wrote:

    At the risk of repeating myself – …

    Once more you have barged into a discussion, without producing any new facts or offering any perspective to the question at hand that you have not already offered on dozens of previous occasions.

    Andrew Reynolds wrote:

    … do you see any reason why I should not point out that the problem in Mexico could be that the government owned oil monopoly (PEMEX) may not be competent to handle their oil industry?

    Yes there is. If you don’t provide any evidence to prove that PEMEX is not competent to handle Mexico’s oil resources, other than your hunch that because it is government owned it therefore must be incompetent, you are (yet again) wasting everybody’s time. Even if it can be shown that PEMEX has mismanaged Mexico’s oil reserves, what evidence have you to show that the private oil companies, which for years concealed from the world the true picture of how our oil reserves have been dwindling, would be any more competent?

    Andrew Reynolds wrote:

    … That cutting out foreign money means that they cannot explore the areas properly?

    If you have any evidence to show that handing Mexico’s oil resources across to private, most probably, foreign-owned oil, companies to exploit as they choose, will significantly improve the prospects for the discovery of oil, let alone guarantee the oil can be extracted from Mexico, at the current rate, into the indefinite future, please produce it.

  34. gordon
    November 29th, 2006 at 08:49 | #34

    Thanks, Andrew Reynolds. I take your point about the difficulty of translating costs calculated years ago in the US into the contemporary Australian scene. But I don’t see any evidence that Switkowski has done the adjustments you suggest. And looking again at the U. of Chicago study with your improved figures of $US27.70 – $US45.01 in mind, I can find no better match than the apparently impossible range in the U. of Chicago’s Table 15 which I referred to above.

    By the way, I notice that Prof. Jim Falk (U. of Melb.) and others have formed a group called The EnergyScience Coalition to counter the Switkowski report. Prof. Falk said: ” We have supported the EnergyScience project to provide a factual and scientifically informed counterweight to the primarily pro-nuclear voices on Ziggy Switkowski’s panel” (From Canberra Times, 20/11/06, p.6) I wonder if they would like to enter the Mole competition?

  35. November 29th, 2006 at 14:12 | #35

    James,
    I would encourage you to read the wikipedia article on that oil field. According to that, PEMEX’s attempts to keep the oil flow high in the short run have reduced the total recoverable amount of oil. From the Economist, the same things, and probably worse, are happening in Venezuela, again for short term political reasons.
    Any private company doing those things would not be forgiven by its shareholders.

  36. gordon
    December 1st, 2006 at 08:32 | #36

    Some further delving and burrowing may have revealed the origin of one of the ends of the cost range ($A40 – $A65) for nuclear several times referred to by Switkowski. This range is taken from a single study done by the U. of Chicago in 2004 (see graph on p. 47 of Switkowski). The EPRI study which reviewed previous work on the comparative costs of nuclear and fossil generators as a background study for Switkowski is available from the same website, and shows how 2003 US dollars were translated into 2006 Australian dollars. Using this method, $A65 (2006) translates as $US44 (2003). A figure of $US44 does occur in the U. of Chicago study; it is a cost of nuclear electricity in $/MWhr derived from the most optimistic estimate of the cost reductions in plant construction available from “learning by doingâ€? (Table 16, p.S-15). This means that it could be a cost of electricity derived from the fifth plant built to the same design by basically the same people, if those people improved their performance very fast as they built successive plants.

    I’m still unable to find a plausible origin for the lower end of Switkowski’s range – $A40. Using the EPRI method, this translates into $US27.20 (2003 dollars). The only vaguely similar estimate in the U. of Chicago study is $US26, from Table 15 where residual costs are presented after deducting a swag of Govt. subsidies. I suppose it is just possible that Switkowski has constructed a “rangeâ€? from the lowest non-subsidised cost and the lowest subsidised cost, but I’m still trying to give him the benefit of the doubt.

    I also notice that the range of costs without subsidies or assumptions about “learning by doingâ€? estimated by the U. of Chicago study is $US53 – $US71 (2003 dollars). By the EPRI method, this translates into $A78 – $A104 (2006 dollars). This estimate is close to the Wicks estimate of $A75 – $A112. If consistency is an indication of credibility in this sort of crystal-gazing, this would seem to be the more credible range.

  37. December 1st, 2006 at 13:33 | #37

    Andrew,

    As I wrote, “Even if it can be shown that PEMEX has mismanaged Mexico’s oil reserves, what evidence have you to show that the private oil companies, which for years concealed from the world the true picture of how our oil reserves have been dwindling, would be any more competent?”

    The solution to the seeming poor management of the oil resources in Mexico and Venezuela is not for the people of those countries to hand over the ownership and control of these resources to private companies to exploit, rather it is make the managers of these enterprises accountable to their “shareholders”, i.e. to the citizens of their respective countries.

    Of course, I realise that you maintain that such a course would be doomed to failure, but you and I obviously both have different estimations of the intelligence and integrity of the ordinary citizens of this country and, presumably, also of Venzuela and Mexico.

    In Venezuela’s case, I think at least full marks should be given to Hugo Chavez’s attempts to make the resources available to the poor of the region. I can well appreciate that you, and many of the oil workers, who participated in the US orchestrated attempt ot oust Hugo Chavez from power, would consider this the most heinous of all possible crimes of any national political leader.

    BTW, why should you care if the rapid decline in the Cantarell oil field “is postulated to be a result of production enhancement techniques causing faster oil extraction at the expense of field longevity?” Haven’t you been saying over and over again, whenever I protest at the waste of natural resources elsewhere, that market forces will easily find replacements for oil once it is exhausted? Perhaps the posts that you have written on this blog site may have found an audience in the managers of PEMEX and they have foolishly acted upon what you have written.

    In any case, Trujillo’s mismanagement of telecommunications companies both in Australia and in the US shows amply that privately managed corporations are as capable of destroying their own long term viability as you allege PEMEX is.

  38. December 1st, 2006 at 14:37 | #38

    James,
    I have no doubt of the integrity or ability of the ordinary citizen of any country. It is their governments I doubt, which is why I believe the governments should have less power and the people more. I have explained that time after time after time to you. Perhaps one day you will grasp the concept that the government is not the people and vice versa. I live in hope.
    Hugo Chavez is making the resources available to the poor of every country that agrees to help him in his campaign against the US – except, of course, those of his own country. In any case, (IMHO) the aid he is giving to other nations will be wasted by their government before getting anywhere near the poor.
    On Cantarell – I care about any wastage. The longer we can delay the change away from oil the better – it is a good fuel source and the longer we use it for the better the likely replacements.

  39. December 1st, 2006 at 14:39 | #39

    Oh, and it is not me making the PEMEX bit – I did not write the wiki article, I merely referenced it. If you have evidence to the contrary I would be interested to see it and then, perhaps we can correct the wiki piece.

  40. December 2nd, 2006 at 02:22 | #40

    Andrew Reynolds wrote: I have no doubt of the integrity or ability of the ordinary citizen of any country.

    Rubbish! Again, here are your own words:

    As for the government – for some odd reason it is full of politicians. In this case they are trying to do what is right (at least in their opinion), rather that what they believe to be popular. As a result, they are trying to keep their heads down. The reason it is being rushed through is to get it done ASAP so that it will be forgotten by the next election. The reason the ALP is trying to slow it down is so that it is still around by the next election. It is politics that is driving this, not the rights and wrongs of the case.

    Let’s be clear here. What the politicians and you are hoping “will be forgotten by the next election” was the Telstra Privatisation legislation that was being rushed through the Senate without proper debate or scrutiny.

    Why would you maintain that proper debate of the privatisation legislation in Parliament and at election time would help, rather than harm, the prospects of those voting for the legislation if you had “no doubt of the integrity or ability of the ordinary citizen?”

    In truth you have made it clear that you believe ordinary Australians are too stupid be trusted to make up their own minds on questions such as privatisation, particularly at election time.

    Your hostility to government is indeed nothing more than hostility to your fellow citizens, the citizens of Venezuela, who support Chavez, and the citizens of Mexico.

    Andrew Reynolds : On Cantarell – I care about any wastage.

    Again, rubbish! You only ‘care’ about wastage when it suits your ideological agenda.

    … and where did I challenge accuracy of the article on PEMEX?

  41. December 2nd, 2006 at 10:45 | #41

    Andrew Reynolds wrote: I believe the governments should have less power and the people more.

    Why don’t you tell that to the workers who have had their entitlements to overtime penalty rates, shift allowances, meal breaks and pubic holidays taken away from them under John Howard’s Industrial relations legislation?

    One of the women who addressed Thursday’s IR rally was checkout operator who had considered John Howard to be her hero until her award conditions were destroyed under his IR legislation. Why do you think it is acceptable in a democracy for John Howard to have got this woman’s vote in 2004 without her knowing what he had planned to do to her pay packet?

    I’ll bet you want this “forgotten” by 2007 when you intend to hand out how to vote cards for your idol John Howard. We wouldn’t want you to have these people give you a piece of their mind about legislation, which you don’t even believe has gone far enough, as they walk in to cast their ballot, now would we?.

    What do you think of 107 workers in Western Australia who have been given fines of $34,000 each under Howard’s IR laws. Their delegate was sacked for having told them to go home on a hot day. The workers held a stop work meeting and got him reinstated. Months later they were served with notices that they each had to pay $34,000 for having breached a law that was not even discussed in the 2004 elections.

    Do you know that building workers can be interrogated under these laws and sent to jail if they refuse to answer questions? They can even go to jail if they discuss the interrogation with others.

    Another example of “governments having less power”?

    Andrew Reynolds wrote: I have explained that time after time after time to you. Perhaps one day you will grasp the concept that the government is not the people and vice versa.

    Are shareholders of a corporation the same as a corporation?

    What is your point?

    The fact that you have done your level best to have brought about the current situation where our Government is as distant and unaccountable from the people as John Howard’s is shows that this objection to government’s playing a role in our society is disingenuous and hypocritical.

    Obviously, logically, a ‘government’ can never be completely the same as the people being governed, and I have acknowledged that many times. Why do you keep wasting my time with such stupid restatements of the obvious?

  42. December 3rd, 2006 at 23:29 | #42

    James,
    Yet again (and again and again) you seem to be confusing me with someone who support any and everything this government does. This is as silly as me confusing you with someone who supports everything the Labor Party says it wants to do. Try again. From what you have said (I believe) you tend to support the ALP. I tend to support the Liberal Party. If you think this means I support everything they do in government you are just plain wrong.
    Now you are thinking of blathering about how much wrong they have done. They are a government – they do some wrong. Next.
    The piece you keep quoting of mine – read it again. Particularly this sentence. Actually read it and see if your comprehension skills go up. “In this case they are trying to do what is right (at least in their opinion), rather that what they believe to be popular”. I think that answers your point. If not, let me know and I will try to rephrase more simply.
    On PEMEX – I think this sentence makes it clear “…capable of destroying their own long term viability as you allege PEMEX is” (your words). I was merely repeating what was in wikipedia. I say again, do you have contrary evidence?
    Shareholders of a corporation are not the same as the corporation. It is a legal principal caled the “corporate veil”. I take it though that the point, such as it was, was rhetorical.
    My point, is, I think, simple. Adding to the government’s powers does not increase the powers of “the people”. It reduces them. It is that simple and that direct. You seem to believe that adding to the government’s power increases the power of the people in some way. If this is not the case, please correct me. This sentence, though, IMHO, shows your confusion on this point “…is not for the people of those countries to hand over the ownership and control of these resources to private companies to exploit”. The people do not own it – the government does. The government is not the people, ergo, this sentence appears to be founded on an incorrect premise, a premise you yourself admit to be not well founded in the last sentence of your previous comment. Your sentence should, therefore, read “…is not for the government of those countries to hand over the ownership and control of these resources to private companies to exploit”.
    If you had said this, I would not have understood you to be confused on this point.

  43. December 4th, 2006 at 14:24 | #43

    James,

    Andrew Reynolds wrote on last week’s “Monday message board�: you seem to be confusing me with someone who support any and everything this government does.

    If you actively supported this Government in 2004 and plan to do so again in 2007, go on excusing its behaviour, then as far I am concerned you are morally culpable for what it has done. If you maintain that I am not being fair to you, then please don’t hesitate to correct me by saying where you stand on the questions I have raised, starting from here and here.

    Andrew Reynolds wrote: Adding to the government’s powers does not increase the powers of “the peopleâ€?. It reduces them. It is that simple and that direct. Blah blah blah rhubarb blah rhubarb rhubarb The people do not own it – the government does. blah rhubarb blah rhubarb rhubarb

    I have dealt with this almost countless times before. Obviously we are never going to agree on this point, so, yet again I ask, why do you waste my time and everyone else’s time by repeating your same tired old points over and over and over again?

    Back into the correct thread.
    My position on workplace reforms should be clear – no regulation. People should be free to contract as they see fit. Workchoices, while an improvement in the freedom to contract, is nowhere near enough, as your example of the $34,000 fine shows.
    On the other point, I was merely showing your confusion on this. You maintained that the people should not sell the assets. I pointed out that the people do not own them – the government does. You then said, and I would agree, that the government and the people are seperate. It showed, IMHO, you are confused as to whether the government is “the people”. Feel free to show how you square that circle.

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