Claim: Putting a price tag on the 2°C climate target no more expensive than fossil fuels

Addressing climate change will require substantial new investment in low-carbon energy and energy efficiency – but no more than what is currently spent on today’s fossil-dominated energy system, according to new research from IIASA and partners.

To limit climate change to 2° Celsius, low-carbon energy options will need additional investments of about US $800 billion a year globally from now to mid-century, according to a new study published in the journal Climate Change Economics. But much of that capital could come from shifting subsidies and investments away from fossil fuels and associated technologies. Worldwide, fossil subsidies currently amount to around $500 billion per year.

“We know that if we want to avoid the worst impacts of climate change, we need to drastically transform our energy system,” says IIASA researcher David McCollum, who led the study. “This is a comprehensive analysis to show how much investment capital is needed to successfully make that transition.”

The study, part of a larger EU research project examining the implications and implementation needs of climate policies consistent with the internationally agreed 2° C target, compared the results from six separate global energy-economic models, each with regional- and country-level detail. The authors examined future scenarios for energy investment based on a variety of factors, including technology progress, efficiency potential, economics, regional socio-economic development, and climate policy.

Investments in clean energy currently total around $200 to 250 billion per year, and reference scenarios show that with climate policies currently on the books, this is likely to grow to around $400 billion. However, the amount needed to limit climate change to the 2° target amounts to around $1200 billion, the study shows.

The energy investments needed to address climate change continue to be an area of large uncertainty. By comparing the results from multiple models, the scientists were able to better define the costs of addressing climate change.

“Many countries say that they’re on board with the a target of  2° Celsius global mean temperature stabilization by 2100; some have even made commitments to reduce their greenhouse gas emissions. But until now, it hasn’t been very clear how to get to that point, at least from an investment point of view. It’s high time we think about how much capital is needed for new power plants, biofuel refineries, efficient vehicles, and other technologies—and where those dollars need to flow—so that we get the emissions reductions we want,” says McCollum.

IIASA Energy Program Director Keywan Riahi, another study co-author and project leader, says, “Given that energy-supply technologies and infrastructure are characterized by long lifetimes of 30 to 60 years or more, there’s a considerable amount of technological inertia in the system that could impede a rapid transformation. That’s why the energy investment decisions of the next several years are so important: because they will shape the direction of the energy transition path for many years to come.”

The study shows that the greatest investments will be needed in rapidly developing countries, namely in Asia, Latin America, and Sub-Saharan Africa.

“Energy investment in these countries is poised to increase substantially anyway. But if we’re serious about addressing climate change, we must find ways to direct more investment to these key regions. Clever policy designs, including carbon pricing mechanisms, can help.” says Massimo Tavoni, researcher at the Fondazione Eni Enrico Mattei, a climate research center in Italy, and overall coordinator of the LIMITS project, of which the new study is a part.

The researchers note that their analysis of future investment costs does not attempt to quantify the potentially major fuel savings from switching from fossil fuels to renewable sources, such as wind and solar energy. As shown in the IIASA-led Global Energy Assessment, such savings could offset a considerable share of increased investment on a global scale.

This study provided an important input into the Intergovernmental Panel on Climate Change Fifth Assessment Report, Working Group III, Chapter 16 on Cross-cutting Investment and Finance Issues.

About the LIMITS project

This study was conducted as part of the Low Climate Impact Scenarios and the Implications of Required Tight Emissions Control Strategies (LIMITS) project, a European Union Seventh Framework Program (FP-7)-supported collaboration between the International Institute for Applied Systems Analysis (IIASA), the Fondazione Eni Enrico Mattei (FEEM) in Italy, the Potsdam Institute for Climate Impact Research (PIK) in Germany, the, the Joint Research Centre of the European Commission, Central European University, the National Development and Reform Commission Energy Research Institute in China, the Indian Institute of Management (IIM), the National Institute for Environmental Studies (NIES) in Japan, and the Pacific Northwest National Laboratory (PNNL) in the US.

Reference

McCollum D, Nagai Y, Riahi K, Marangoni G, Calvin K, Pietzcker R, Van Vliet J, van der Zwaaan B. (2014). Energy investments under climate policy: a comparison of global models. Climate Change Economics Vol. 04, No. 04. DOI: 10.1142/S2010007813400101

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107 Responses to Claim: Putting a price tag on the 2°C climate target no more expensive than fossil fuels

  1. Doug says:

    “Worldwide, fossil subsidies currently amount to around $500 billion per year.”

    I sure wish someone would show me those subsidies. I ran my $500 a month of oil production through turbotax, and when the domestic production tax credit came up, it was just about eliminated because the income is from oil and gas. Gravel, corn. political pamphlets, anything would get a tax break as long as it is not oil or gas. I imagine solar and wind would be treated a bit better.

  2. ” That’s why the energy investment decisions of the next several years are so important: because they will shape the direction of the energy transition path for many years to come.”
    ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
    No, that is why political decisions in the next several years are so important: because they will shape the direction of the economy for many years to come. Lemmings!

  3. Streetcred says:

    Foundations of which are probably all based upon the unrealistic climate models. Funny, how many billions have been wasted already … and positive results have they achieved. Just goes to show, you get what you pay for and this study appears to support that.

  4. Streetcred says:

    Err … “and what positive results have they achieved?

  5. richardscourtney says:

    Anth0ny:

    Thankyou for publishing the above report. It says,

    We know that if we want to avoid the worst impacts of climate change, we need to drastically transform our energy system,

    says IIASA researcher David McCollum

    McCollum does not say whom he means by “We”, but they are wrong. Indeed, that is why the OCO-2 satellite has just been launched (as reported on WUWT here).

    Perhaps it would be wise to wait a few years to discern if there is any need to “transform our energy system” by returning to expensive, inefficient, unreliable, and intermittent forms of power supply that were abandoned generations ago.

    And, I would add that if McCollum and the rest of his “We” really want to return to using the power of wind and the power of the muscles of slaves and animals then they should volunteer to be slaves.

    Richard

  6. Mike Jonas says:

    I’m bemused by the claim that fossil fuels are subsidised. In Australia we pay about 38c tax per litre of petrol. In the UK the tax is 57.95p/litre, Canada 16-30c/litre, USA 48c/gallon+state taxes. There are taxes on diesel and LPG too. These are all on top of all the normal taxes. Virtually all European countries, and some others, levy taxes on petrol and other fossil fuel products. Methinks that some people scream about the odd concession and shut their eyes to the main game.

  7. Crispin in Waterloo but really in Singapore says:

    Follow the money. Who will be getting the money instead of the guys who keep us working and warm now? $800 billion a year sounds like a lot, even to me.

  8. Alan the Brit says:

    “The energy investments needed to address climate change continue to be an area of large uncertainty.”

    And they want around a $trillion investment based on this statement? Are they serious? Did they undertake their “study” in the middle of the Sahara at mid day when they arrived at that conclusion? Should we not reduce this “area of large uncertainty” down a tad to a dead cert, before “we” squander all that dosh first? Sheesh!

  9. richard verney says:

    I too have for a long time wondered what all these subsidies on fossil fuel consist of. Those that claim that fossil fuels are heavily subsidised and/or that ‘we’ are not paying the full price of carbon always seem coy and reluctant to put details on their claims by setting out the subsidies and/or what is the true cost of carbon and why and how it arises. I sure wish that someone would list them so that a view can be taken on whether they are justified or otherwise reasonable.

    The only ‘subsidy’ that I have seen mentioned is that jet fuel is not taxed as highly as other fuels. Personally, I do not consider that a subsidy in the true sense. The decision to tax anything is a political decision, and is punitive. Further, on this small point, air travel, in the UK, attracts its own special tax which in effect goes to off-set the fact that a lower tax is applied to jet fuel. With some cheap carriers, when a passenger is travelling without any luggage, the passenger taxes are sometimes the largest part of the ticket cost!

    Due to the high passenger levey, it is often cheaper to use hub airports in Europe to travel long haul. Inconvenient and not something relevant to the business traveller, but a family of 4 can often make significant savings if they fly short haul to a hub airport in Europe and then swop planes for the long haul flight.

  10. “Worldwide, fossil subsidies currently amount to around $500 billion per year.”

    Notice that this study has apparently aggregated the national accounts of all countries in the world. This works for labor and capital although prices for labor and capital are distorted by barriers that restrict the cross-boundary flow..

    I would like to see how these subsidies are computed. I suspect that “subsidies” equal the difference between domestic prices for fossil fuels and world market prices.

    The first thing I wonder about is whether or not the world price of petroleum is distorted by taxation regimes in a manner that causes these prices to be greater than the factor prices of labor and capital necessary for production of fossil fuel.

    I base this on consideration of the relative roles of land, labor and capital in production. And this leads me to wonder what role “land” has in world market price of fossil fuels.

    In the context of economic analysis “land” includes not only the territory on and under the surface of the Earth, but also all the institutions, laws and conventions that regulate the exploitation, production and distribution of the fossil fuels.

    In the most simple terms, land generates rent. You have title to exclusive use to a land resource and you derive rent not from the piece of territory but from the piece of paper that says you are the owner and the government that enforces your rights. This is the economist’s context for land and rent. This is why the AmerInds sold their land to Europeans for a pittance. Because they did not have the concept of “land ownership” and “rent”.

    By definition, labor and capital comprise value-added while “land” represents economic rent that arises through the authority of public and private institutions that control the resources in the ground.

    In my opinion, “subsidïes” should include only the difference between the domestic prices and the value added by labor and capital because, by definition economic rent is merely a monetary transfer that in most cases represents no resource cost. If labor and capital are involved, then the payment is not rent but value-added.

    The reason that the role of rent is not obvious in the fossil fuel sector is because domestic and world market prices, value-added, rents and taxes are computed in national accounts, not aggregated worldwide.

    However, the study discussed here has aggregated the national accounts of the world. Thus cross-border rents should be treated as mere transfers and not included as value-added.

    As a footnote, it may be worth considering to what extent laws that prevent exploitation of fossil fuels has the effect of driving up their prices in a similar manner as OPEC attempted to achieve.

    So law that prevent the exploitation of offshore oil or unconventional gas (fracking) and/or prevent the importation or exportation of fossil fuels have the effect of distorting the factor of production we call “land”. The consequence is to increase the economic rent to current producers.

    I conclude that the US government maintains the “economic rents” of foreign producers by maintaining restrictions on exploitation of fossil fuels on Federal lands and US offshore deposits, and by restricting trade in fossil fuels. It may be no consolation to say that European countries maintain even more absurd policies than the US.

  11. Rolf says:

    Well, maybe the study is working as designed ……

  12. richard verney says:

    Mike Jonas says:
    July 3, 2014 at 1:05 am
    //////////////////////////

    And in the UK, Value Added Tax (at 20%) is levied on the sale. This tax (VAT) is therefore levied on the fuel duty tax, so that this adds a further 20% to the overall fuel duty paid by the customer.

    One reason why it will be so difficult for Governments to pull away from cAGW, is the tax that they levy on fossil fuels. If there is no real AGW then people will question why should they pay the green taxes that have been introduced these past 30 years. For example, the motorist pays very heavily, and Governments who love spending money and would not dream of cutting projects would find it very difficult to cut back on the taxes they receive from motorists and the like. What will replenish this revenue stream?

    This is one of the reasons why they are so keen to keep the cAGW bandwagon rolling, and why the summary for policy makers does not incorporate the growing views amongst climate scientists that sensitivity to CO2 may be less than previously thought, and the role of natural variation may be greater than previously thought. The disconnect in AR5 is greater than in AR4 because of the need by Governments to preserve their tax structures (in which I include the subsidies that they have committed towards renewables).

  13. Olaf Koenders says:

    richardscourtney says:
    July 3, 2014 at 12:59 am
    “Perhaps it would be wise to wait a few years to discern if there is any need to..”

    Nup. Not possible. Imagine CAGWists getting a proper job for a few years after swanning on this gravy train for the last few DECADES?? It’d be like removing their oxygen supply, which would be preferable in my book.

    They’re gonna milk this to the end, as the story makes adequately clear.

  14. Stacey says:

    “Worldwide, fossil subsidies currently amount to around $500 billion per year.”
    Are the confusing tax relief and lower taxation with subsidies.
    A subsidy is when government gives away money whilst lower taxation means governments are not taking money from industy and consumers?
    Thus the picture is totally distorted?

  15. Steve Reddish says:

    So, $800 billion per year is the same as $500 billion per year? It’s not a 60% increase? And much of it could come out of the $500 billion?? Even a diversion of 80% of the $500 billion would only provide 50% of the $800 billion.

    And the goal is to limit global warming to 2 degrees Celsius by 2100?

    See http://www.drroyspencer.com/wp-content/uploads/UAH_LT_1979_thru_June_2014_v5.png

    This record indicates at worst, a .3 degree Celsius increase every 20 years or so. If this pattern continues through 2100, there would be only 1.5 degree Celsius additional gain by then. There is no indication we need to waste, er… spend any more on CO2 containment.

  16. johnmarshall says:

    Prof Phil Jones was asked where the 2C danger level came from. His reply was that he did not know and perhaps it was ”plucked out of the air”.
    2C is actually less than 1% of the ”normal” temperature in Kelvin, the scale we should use.

  17. knr says:

    Worldwide, fossil subsidies currently amount to around $500 billion per year.

    If you ever wonder why they never say who actual pays the vast majority these subsidies its because its not the ‘evil west ‘ at all, but places like Iran or Venezuela who do it for the bread and circus affect. And who have no intention what so ever of changing their ways , not that those who moan about these subsides ever consider asking them to.
    That is before we get to the small problem of using money for something that works and mets a need , compared to using money for something which sometimes works and only meets needs to a limited extent due to factors over which no one has control , unless you know any one that can stop the rotation of planets .

  18. ROM says:

    Speigel on Line; april 2010

    Climate Catastrophe: A Superstorm for Global Warming Research
    Part 8: The Invention of the Two-Degree Target
    http://www.spiegel.de/international/world/climate-catastrophe-a-superstorm-for-global-warming-research-a-686697-8.html

    [ quoted ]
    a group of German scientists, yielding to political pressure, invented an easily digestible message in the mid-1990s: the two-degree target. To avoid even greater damage to human beings and nature, the scientists warned, the temperature on Earth could not be more than two degrees Celsius higher than it was before the beginning of industrialization.

    It was a pretty audacious estimate. Nevertheless, the powers-that-be finally had a tangible number to work with. An amazing success story was about to begin.

    ‘Clearly a Political Goal’

    Rarely has a scientific idea had such a strong impact on world politics. Most countries have now recognized the two-degree target. If the two-degree limit were exceeded, German Environment Minister Norbert Röttgen announced ahead of the failed Copenhagen summit, “life on our planet, as we know it today, would no longer be possible.”

    But this is scientific nonsense. “Two degrees is not a magical limit — it’s clearly a political goal,” says Hans Joachim Schellnhuber, director of the Potsdam Institute for Climate Impact Research (PIK). “The world will not come to an end right away in the event of stronger warming, nor are we definitely saved if warming is not as significant. The reality, of course, is much more complicated.”

    Schellnhuber ought to know. He is the father of the two-degree target.

    “Yes, I plead guilty,” he says, smiling. The idea didn’t hurt his career. In fact, it made him Germany’s most influential climatologist. Schellnhuber, a theoretical physicist, became Chancellor Angela Merkel’s chief scientific adviser — a position any researcher would envy.

    Rule of Thumb

    The story of the two-degree target began in the German Advisory Council on Global Change (WBGU). Administration politicians had asked the council for climate protection guidelines, and the scientists under Schellnhuber’s leadership came up with a strikingly simple idea. “We looked at the history of the climate since the rise of homo sapiens,” Schellnhuber recalls. “This showed us that average global temperatures in the last 130,000 years were no more than two degrees higher than before the beginning of the industrial revolution. To be on the safe side, we came up with a rule of thumb stating that it would be better not to depart from this field of experience in human evolution. Otherwise we would be treading on terra incognita.”

    As tempting as it sounds, on closer inspection this approach proves to be nothing but a sleight of hand. That’s because humans are children of an ice age. For many thousands of years, they struggled to survive in a climate that was as least four degrees colder than it is today, and at times even more than eight degrees colder.

    This means that, on balance, mankind has already survived far more severe temperature fluctuations than two degrees. And the cold periods were always the worst periods. Besides, modern civilizations have far more technical means of adapting to climate change than earlier societies had.
    [ more ]

  19. glenncz says:

    This is from an old 2007 US Gov’t report for electricity subsidies. Scroll down to page 106 near the end of the PDF.
    http://www.eia.gov/oiaf/servicerpt/subsidy2/pdf/chap5.pdf
    Solar and Wind receive 100X the subsidy as Nat Gas & Petroleum liquids Per Unit of Production.
    The $500 billion fossil subsidies might sound like a lot. But it’s peanuts compared compared to the value we receive. And is that even a subsidy as opposed to a tax break. There is a huge difference between a tax deduction and a Federal tax credit.
    Here’s an article saying the fossil “subsidies” are simply normal tax deductions taken by every business.
    http://townhall.com/columnists/pauldriessen/2011/08/26/spreading_big_oil_subsidy_disinformation/page/full

  20. Willis Eschenbach says:

    Anyone know if there is a non-paywalled copy of this POS out there?

    w.

  21. Kate Forney says:

    $500bn subsidy? I guess in the prog world, letting you keep money you legitimately earned is the government “subsidizing” you. Their mindset is that the government rightly owns the fruits of your labor and lets you keep some if it out of largesse.

    We could give wind and solar trillions in subsidies: Just increase the tax rate so that their tax liability would be trillions of dollars, then give them a “tax credit” for it. Voila, trillions in subsidies. Same as “oil”.

  22. Truthseeker says:

    Nobody who actually performs any real science thinks that CO2 does anything that is not beneficial. Whichever side of the “Greenhouse Gas” debate you are, all those that look at the observational science say that any warming from CO2 is minor and a good thing. More importantly the more CO2 there is the better the biosphere likes it. There is no valid reason for replacing coal, oil and gas with wind and sunlight. It is all about energy flux density and oil, gas and coal have it and wind and sunlight do not. It is that simple.

  23. Gamecock says:

    “By comparing the results from multiple models, the scientists were able to better define the costs of addressing climate change.”

    The average of crap is . . . wait for it . . . crap.

  24. Eric Worrall says:

    Carbon pricing applied to Sub-Saharan Africans – how many people would that kill?

  25. SAMURAI says:

    What a bunch of BS.

    First of all, the “$500 Billion” fossil fuel “subsidy” meme is completely BS.

    This $500 billion in “subsidies” is comprised of depreciation write-offs given to ALLLLLL corporations (with a few special oil-industry specific tax breaks). It also includes insane REIMBURSEMENTS by insane governments that force oil companies to sell gas below cost to enable the corrupt politicians to buy votes.

    Personally, I don’t think corporations should pay ANY taxes, since all they do is pass along their tax obligations to consumers in the form of higher product and service costs.

    Imagine the $trillions off-shore retained earnings that would flood into the US if all corporate profits were tax free and the 1,000’s of corporations that would come to the US if they could keep all their profits… It boggles the mind.

    Anyway, Alt-En companies DO receive government subsidies because without them, there would be almost ZERO demand for their products as their products are too expensive to be feasible. There is a SMALL demand for existing alt-en products as back-up power systems for rich people, people that wish to live off the grig, or people in very remote areas with no access to a power grid…

    Every DIME of alt-en subsidies is a complete waste of money and distorts the efficient/effective use of limited land, labor and capital. If a product/service cannot survive without subsidies, it shouldn’t exist. These wasted subsidies would be better utilized as the MARKET (not political hacks) decides.

    Governments SUCK at picking winners and losers.

  26. R. de Haan says:

    All this GIGA is in support of the robbers, parasites, collaborators and centralists bringing about the demolition of our economies, the elimination of the consumer society, the Middle Class and the population reduction envisioned by UN Agenda 21. The time has come to see their practices for what they really are because these people betrayal human kind and our civilization.
    Does the name ECO NAZI”S ring a bell?

    But when these people present themselves with the statue of King and the voice of a savior promising hope and change and rewarded with a Nobel Peace price before they start their killing spree, what can we do? Tar and Feathers?
    They have declared war on us.
    Time to wake up.
    http://green-agenda.com

  27. Alan the Brit says:

    Where did they get that 2°C limit when at least two (& probably more) of the last four Inter-glacials were warmer than today by between 2-4°C, & we’re still here!!!! No problemo!!!!

    Slightly off topic: I have in recent months when either being verbally accosted by or discussing with a warmist, when being labelled a denier, tended to refer to the UNIPCC’s opinions of Global Guvment, as their “Final Solution” to manmade Global Warming!. This has turned the argument around for me taking into account the deliberate & malicious & insidious efforts to link people who deny AGW with Holocaust denier. So far it has had the desired effect of unsettling my opponents. I don’t like doing it, & I hate to say “they started it”, but it has stood me in fairly good stead.

  28. Bill Illis says:

    Between surface rights leases, oil production royalties and other taxes, Exxon paid $104 billion in taxes to governments around the world in 2012. That’s more than the total tax revenue generated by any government other than the top ten.

    By contrast, wind and solar got subsidies of twice that from governments around the world the same year.

    Green people do not know how to count.

  29. Neo says:

    They put a price tag on being a skeptic …

    WASHINGTON (CBS DC) – Physics professor and climate change expert Dr. Christopher Keating is offering a $30,000 reward to anyone who can disprove that man-made climate change is real.

    Keating, a professor of two decades at the University of South Dakota and U.S. Naval Academy, has challenged climate change skeptics to prove that man-made global warming is not real. Keating is prepared to offer $30,000 of his own money for the “Global Warming Skeptic Challenge,” which has an application deadline of July 31.

    “I have heard global warming skeptics make all sorts of statements about how the science doesn’t support claims of man-made climate change,” Keating announced on his blog. “I have found all of those statements to be empty and without any kind of supporting evidence. I have, in turn, stated that it is not possible for the skeptics to prove their claims. And, I’m willing to put my money where my mouth is.”

    Climate-change deniers are considered a minute sect of the science community. A “Global Climate Change” report from NASA finds that 97 percent of climate scientists agree that climate-warming trends over the past century “are very likely due to human activities.” The report also notes that a majority of worldwide scientific organizations have issued public statements endorsing the effects of man-made global warming.

    http://washington.cbslocal.com/2014/07/02/physicist-offers-30000-reward-to-anyone-who-can-disprove-climate-change/

  30. R. de Haan says:

    This is what happens if you have a revolutionary hack in the White House who’s only job requirement is to down the USA and create Global Chaos and despair.
    It’s in the small news: http://cnsnews.com/news/article/brittany-m-hughes/federal-gov-t-sues-wisconsin-company-says-english-language
    And it’s in the big news: http://www.zerohedge.com/news/2014-07-02/yet-another-idiot-economist-says-war-good-economy and http://www.zerohedge.com/news/2014-07-02/bubble-finance-work-how-buyback-mania-gutting-growth-leaving-financial-wrecks-its-wa

    Now go, kick out the hacks and get your country back.

  31. Andy May says:

    Oil and natural gas are not subsidized in the US and in fact large oil companies are excluded from tax breaks that other companies get here. But around the world there are a lot of countries that heavily subsidize oil and natural gas, mostly in OPEC. See this article:
    http://www.businessweek.com/articles/2014-03-13/why-fuel-subsidies-in-developing-nations-are-an-economic-addiction

    Some claim the US oil and gas industry is subsidized through the tax system with special tax deductions, this simply is not true. The US oil and gas industry pays higher taxes than almost all other industry groups.
    http://www.api.org/news-and-media/infographics/the-truth-on-oil-subsidies

  32. John Greenfraud says:

    Only in a Green world would we maintain the false equivalence of allowing the oil business to keep their legitimate profits through tax breaks as opposed to billionaire crony capitalists stealing tax money from the poor and subsidizing their ‘vanity’ energy projects.

  33. Gene Schmick says:

    There is no way they could know how much feasible alternative energy will cost. That is, one that doesn’t need subsidies to keep the price affordable or fossil fuel plants as back up.

  34. MarkW says:

    According to the newest research, all we have to do to limit temperature increases to 2C or less is, nothing.

  35. pat says:

    an extraordinary tale of pricing carbon in Australia:

    2 July: SMH: Philip Chubb: Carbon pricing: how Labor failed the nation
    (Philip Chubb, a gold Walkley and Logie winner, is Head of Journalism at Monash University. His recent book Power Failure examines the inside story of climate politics under Rudd and Gillard.)
    In April 2010 Rudd, whose command and control leadership was precisely the opposite of what was required to solve a complex problem like climate policy, publicly acknowledged defeat. The shock was profound. We had watched the train crash as it came ever-closer, although without recognising the inevitability of tragedy. We had waited in vain for Rudd to explain the meaning of carbon pricing. We had seen him sideline other ministers who might have helped us understand.
    We had been transfixed as he squandered the gift of consensus, employing it as a weapon to destroy Liberal leader Malcolm Turnbull rather than as an opportunity to be grasped fully and urgently. Tony Abbott, with his infantile anti-science slogans, was thus Rudd’s creation. We had invested more faith as he (Kevin Rudd) flew to Copenhagen, puffed up to save the earth, only to suffer an emotional breakdown that left him empty of the courage needed for a double dissolution election. We had sat bemused as he then strove to blame Julia Gillard for his sad rush to hoist the white flag.
    The fact that we got to mid-2010 with a deep black hole where climate policy had been was a result of the erosion of the checks and balances that Australians wrongly believe are embedded in their system of government. We were prey to Rudd’s personality. And what a personality it turned out to be. Australians were victims of his hubris and cowardice. This has become very clear after more than 100 interviews and two years researching the disasters of Australia’s attempt to establish carbon pricing for my book Power Failure…
    The lesson for the future of carbon pricing is this: while Gillard was more effective than Rudd, success requires a restoration of our system of checks and balances and a different type of leader. But for this change to occur Australians must firmly demand it. The immediate prospect of this is not good. We will suffer many more bushfires and floods before we see another serious attempt to price carbon.
    http://www.theage.com.au/comment/carbon-pricing-how-labor-failed-the-nation-20140702-zssyo.html

    ***now, what made me wonder if the arrogant Philip Chubb might be related to our beloved Chief Scientist?

    18 May 2014: ArtsOnline Monash Uni: MFJ celebrates successful school and book launches
    The new School of Media, Film and Journalism (MFJ) was formally launched on May 14 alongside the launch of Associate Professor Phil Chubb’s new book Power Failure.

    ***More than 100 people including Monash’s Chancellor, Alan Finkel, and Dr Elizabeth Finkel, along with Australia’s Chief Scientist, Professor Ian Chubb, who is Phil’s brother, and staff and students attended the joint celebration…

    Distinguished Professor Ross Garnaut launched Power Failure with the words: “This is an interesting and important book…
    http://artsonline.monash.edu.au/journalism/mfj-celebrates-successful-school-and-book-launches/

    UNBELIEVABLE!

  36. herkimer says:

    The problem of the future may not be how we keep the world climate from rising 2 degrees but how to survive a winter climate regionally that drops as much as 16 degrees F or – 4.4F /DECADE like we saw in the US UPPER MIDWEST between 1998 and 2014 and similar drops in Canada between 2010 and 2014 . Why are winter temperature drops significant? Because cold winters spill into cold spring weather like we saw this year . This also can lead to cooler summers and early cooling of fall resulting in annual temperature drops. This has been the pattern in North America since 1998 or 16 years now . Winters have been cooling globally and for the Northern Hemisphere. for 17 years .The alarmists have the wrong priorities again

  37. MarkW says:

    To most liberals, any tax that is less than 100%, is a subsidy.

  38. Dave says:

    Only a government study could conclude that 300 billion more dollars is pretty much the same as 300 billion less.

  39. Bruce Cobb says:

    Neo says:
    July 3, 2014 at 4:32 am

    I challenge Keating to disprove that the Flying Spaghetti Monster is real.

  40. pat says:

    oops, the Philip Chubb article i posted “Carbon pricing: how Labor failed the nation” was from the The Age newspaper, tho it also appeared in The Age’s sister Fairfax newspaper, Sydney Morning Herald (SMH).

  41. hunter says:

    The cruel wasteful folly of a leadership class that believes they can manage the weather is something not seen since virgins were sacrificed by royal priests to appease gods to end a drought.

  42. Tom Bakert says:

    “The study compared the results from six separate global energy-economic models, each with regional- and country-level detail. The authors examined future scenarios for energy investment based on a variety of factors, including technology progress, efficiency potential, economics, regional socio-economic development, and climate policy.”

    The climate models based on presumably hard objective science have failed spectacularly. How can these idiots lend any credence to models based on such subjective fields such as economics and sociology?

  43. Cheshirered says:

    Almost every ‘report’ of this nature is based on delivering a pre-determined conclusion to justify recommending implementation of certain desired actions. (See the Climategate enquiries if you can without weeping.) We can safely deduce the motives present here from the claim (in reality a straightforward misdirection) that “Worldwide, fossil subsidies currently amount to around $500 billion per year.”

    It’s just another Stern Review lite.

  44. Jenli says:

    I think that subsidies, as they are paid, for example, in Germany for decades, have been included in calculation of the study. The subsidies were intended to preserve the German coal from foreign coal competitive because the funding in Germany is actually too expensive.

    Some numbers from Germany:

    The “RAG Deutsche Steinkohle AG” received about 2.0 billion euros subsidies from the federal government to the coal industry in Germany in 2008. This corresponds to approximately 9.3% of the total subsidies of the Federal Republic.

    According to the 20th Report of the Federal Government subsidy were between 1997 and 2006 aid totaling € 29.9 billion from the federal government (3 billion per year) and a further 4.9 billion euros by the State of North Rhine-Westphalia (0.5 billion per year) paid.

    In February 2007, the federal government, North Rhine-Westphalia and Saarland agreed to end the subsidies for the coal industry in 2018. This would in effect in Germany after 2018 no more coal promoted.

    On 28 December 2007 the “Law on financing the completion of the subsidized coal industry in 2018 (Coal Financing Act)” came into force. Therein 2009-2018 additional subsidies of 13.9 billion euros are planned for the years. In addition, the state of North Rhine-Westphalia pays a total of 3.9 billion euros.

    On 20 July 2010 the European Commission presented a proposal which provided for the phasing out of coal subsidies until 1 October 2014. After criticism from Germany, the Council of the European Union agreed on 10 December 2010 on coal subsidies under 2018 continues to allow a decommissioning plan. However, a greater reduction in subsidies is prescribed, as was previously provided in Germany. Compared to the year 2011 have the amount of funding by the end of 2013 by 25%, to be reduced by the end of 2015 by 40% until the end of 2016 by 60% and finally to the end of 2017 by 75%.

  45. Bruce Cobb says:

    Price of limiting “carbon”, to avoid a hypothetical 2C warming?
    29 $trillion.
    Price of limiting standards of living, limiting life expectancies, and thereby killing millions of poor worldwide, especially children?
    Priceless.

  46. wolfman says:

    I suspect part of the “subsidy” is related to the uncompensated costs that the addition of CO2 to the atmosphere is presumed to impose on economies. This is captured in the logic of “carbon” taxes. The other element is the “six economic models” used. What are their discount rates? Further, are the solutions focused on PC “green” solutions (wind, solar, tides, etc.) that are technically suspect; or, would they allow nuclear and incorporating geothermal heat exchange into construction of new buildings?

  47. ferdberple says:

    Worldwide, fossil subsidies currently amount to around $500 billion per year.
    ============
    This is false accounting because it does not take into account fossil fuel revenues. How much money do governments make in return for the $500 billion per year they pay to encourage production?

    A quick calculation shows that tax revenues on oil alone at 10 cents per liter works out to more than $500 billion per year. So, clearly governments are making a profit on the $500 billion they invest to encourage fossil fuel production. A HUGE PROFIT.

    Where is the money going to come from to replace the TAX REVENUE from fossil fuel? Forget the subsidies. How are you going to replace the lost revenue, which are much larger than the subsidies?

    Are you going to place a tax on solar, wind, and bio-fuels? Is this tax on renewables going to be how you finance renewables? How exactly will this work? Isn’t a tax supposed to discourage use?

  48. DirkH says:

    Jenli says:
    July 3, 2014 at 5:36 am
    “The “RAG Deutsche Steinkohle AG” received about 2.0 billion euros subsidies from the federal government to the coal industry in Germany in 2008. This corresponds to approximately 9.3% of the total subsidies of the Federal Republic.”

    Of course, the 24 bn EUR subsidies that Germans pay to the owners of solar panels and wind turbines (who, in turn, need that money to buy and maintain the contraptions) are not even counted as subsidies; as that is elegantly formulated as a price-fixing law (which violates the EU principle of free trade, but this violation has been rubberstamped by the Eurocleptocratic court because it is necessary to save the planet.)

    Back to main topic:
    800 bn USD a year; that’s slightly less than the yearly amount of USD’s printed under Bernanke; so the warmists say, let’s go on with QE4EVER; and when we print 800 bn USD a year, this of course mean that 800 bn new debt come into existence a year.

    The perfect Keynesian scheme: Find a non-existing problem and “fix” it with moneyprinting / debt issuance; continuing the worldwide Keynesian Ponzi scheme for a little while longer, while the warmist scientists can sponge off the money for their make-work schemes. (without actually working)

    When globe fails to warm: Declare success. (Oh, we’ll have hyperinflation instead, but the warmist scientists will have exchanged their Federeal Reserve Notes for tangible assets before that happens.)

    We should all design non-working geo-engineering contraptions now to partake in the money rain.

  49. Mr Watts:

    I. There are frequent comments in the media and blogosphere about the subsidies received by fossil fuels on a world wide basis. I´m very familiar with the topic as far as subsidies in OPEC nations as well as Russia and other oil exporting nations. Most of them use a subsidy via price controls or tax exemptions. For example, in Venezuela the price of gasoline, diesel, and natural gas are controlled, and the first two are nearly free. I used to live in Venezuela, and when we filled up the tank in my Mazda 6 the tip was about triple the fuel cost.

    Other nations, for example Russia, have subsidized oil prices via pipeline tariffs used to drive local prices down. And we could say the USA in some cases has subsidized the price of some hydrocarbons by limiting exports permits (I think this may be applying to natural gas and gas condensates at this time).

    Those who write these articles about hydrocarbon subsidies tend to be quite deceitful, because they don´t explain how they will convince Saudi Arabia, Iran, and Venezuela to stop subsiding fuels (this item was already covered by nkr in an earlier post).

    II. Regarding the degree C limit and the urgency to reduce emissions, there seems to be a very intensive campaign to force changes using the figure, which seems quite arbitrary. Maybe it´s less, maybe it´s more, but it sure seems arrogant to expect we can set the planet´s thermostat.

    I read “False Hope” by Michael Mann in Sciam, and I also noted your comments about the graphs he used, and a response at a blog site called “Open Mind”. It seems to me the debates about the article may have missed the point that, if the article and its figures are bad enough to confuse educated readers, then the article fails. I pointed this out to the blogger at Open Mind, but unfortunately half of my comment was edited out, My intention wasn´t to get into a climate debate, the 2 degree C limit, or whether the world is warming or not. But I do like to discuss whether information is distorted or presented in the wrong way, so I decided to write a little bit about this particular subject, and called it “False Hope by Michael Mann”.

  50. Patrick B says:

    Every time somebody claims that oil and gas get great subsidies, or I see an article on it, at least as far as the US is concerned what they claim to be subsidies are almost entirely tax deductions or credits available to all industries. The amount of true “subsidies” for oil and gas operations is miniscule. Any time someone claims oil and gas is getting huge subsidies – force them to identify those subsidies exactly and then ask them if those are available to all industries and/or represent a balancing of taxes (e.g. the foreign tax credits).

  51. ferdberple says:

    WASHINGTON (CBS DC) – Physics professor and climate change expert Dr. Christopher Keating is offering a $30,000 reward to anyone who can disprove that man-made climate change is real.
    ==========
    He failed to define “man-made climate change”. Only a fool would think that cutting down forests and jungles and replacing them with farms and cities has no effect on climate.

    The question isn’t climate change, but rather how to solve it. How do you get rid of farms and cities without the mass starvation and death such great minds as Pol Pot, Stalin and Mao were famous for?

    The simple answer is you cannot. There is no way we can feed and house 7+ billion people without changing the climate. No matter what we may wish. Thus, we are left with only two possible solutions. Either we get rid of the people, or we learn to live with climate change.

    Because in the end, it is because we have farms and cities now covering 40% of the land’s surface that we are changing the climate. CO2 is simply a by-product of this human activity, not an objective. The driving force is the farms and cities, within the limits of existing technology.

    Climate science fails to grasp this. They see CO2 as a climate driver, but fail to grasp that it is economic activity that drives “man-made climate change”, with CO2 a by-product of our technology at this point in history.

  52. Ivor Ward says:

    This reference to the $500 billion subsidy uses the same logic as my ex wife. She would go out and buy something for $500 with a discount of $150 and then go and spend the $150 dollars with another discount of $50 thus saving a total of $200 in the day to spend tomorrow. Sounds like the perpetrators of this rubbish think that there is $500 billion floating around ready for them to spend on their junk technology. Can you divorce Academic idiots as well?

  53. Lancifer says:

    It is all about energy flux density and oil, gas and coal have it and wind and sunlight do not. It is that simple.- Truthseeker

    This obvious fact should be enough to end most of the discussion of “alternative” fuels.

    Fossil fuels have lifted humanity out of the drudgery and muck it endured for most of it’s existance and these “green” clowns want to drag us back into it.

    Nuclear energy is the sole fuel source that has the potential energy density to replace fossil fuels and of course the vast majority of these carbonphobic fools are against it as well.

  54. ferdberple says:

    Can you divorce Academic idiots as well?
    ===========
    I’m surprised she didn’t buy more. The more you buy, the more you save, until eventually you make a profit with every purchase and can quite your job and retire to a life of shopping.

  55. Bill_W says:

    If they underestimate the true cost and overestimate the true amount of energy from renewables (as well as underestimating the negatives such as higher food prices, burning down forests, heavy metals in solar manufacturing, etc) as they have done in the past, the true cost could be 3-5X instead of just 2-3X. In addition, I believe they are counting standard tax accounting that all firms in the US get as if they were “subsidies”. Personally, I would like to get rid of most true subsidies, but let’s be honest about what is meant by a subsidy.

  56. Jeremy says:

    “Worldwide, fossil subsidies currently amount to around $500 billion per year.”

    Total BS. Absolute complete and utter lies.

    Fossil fuels generate the largest tax receipts of any industry. Royalties etc. & consumer taxes make them easily one of the highest taxed industries in the world.

    Just ask yourself when was the last time an oil company got a subsidy to produce or refine oil below cost? Never! It just doesn’t happen. A tax break on investments or reduced tax due to high operating cost – sure but these are not subsidies, like all activities, tax tends to be weighted towards profits – quote normal.

    http://www.api.org/policy-and-issues/policy-items/taxes/~/media/Files/Policy/Taxes/Oil-Natural-Gas-Industry-Pays-Its-Fair-Share-Taxes.ashx

  57. ferdberple says:

    I suspect part of the “subsidy” is related to the uncompensated costs that the addition of CO2 to the atmosphere is presumed to impose on economies.
    ===================
    Certainly that is the position of China and the third world. By polluting the atmosphere with Carbon Pollution for so many years, the US owes the rest of the world massive reparations for the harm they have done to other economies.

    Now that the EPA and US Supreme Court has recognize Carbon Pollution as harmful, the US doesn’t have a leg to stand on and will need to go cap in hand to China for the money. China will have conquered the US without firing a shot. Sun Tzu and the Art of War. China 500 BC. The best strategy for winning a war is to conquer your enemy without having to go to war.

  58. rogerknights says:

    Here are some posts from the past (on WUWT) wrt subsidies:
    ================

    http://wattsupwiththat.com/2013/04/08/weekly-climate-and-energy-news-roundup-86/

    Fossil Fuel Subsidies: Connie Hedegaard, the EU Commissioner for Climate Action, has an essay demanding that countries stop subsidizing fossil fuels. She states: “According to the IEA, fossil-fuel subsidies rose by almost 30%, to $523 billion, in 2011. Meanwhile, the UN Environment Program reports that global investment in renewable energy totaled only $257 billion in 2011.”

    Ms Hedegaard fails to state that the IEA study she cites shows the vast bulk of fossil fuel subsidies occur in developing countries, not in developed Western nations. In descending order, the five countries with the greatest fossil fuel subsidies are: Iran, Saudi Arabia, Russia, India and China. The omission is all too typical among Western green bureaucrats and Ms. Hedegaard’s logic is far from daunting. Should a western country subsidize expensive, unreliable wind and solar because Iran subsidies gasoline? Please see Article #3 and link under Communicating Better to the Public – Exaggerate, or be Vague?

    HaroldW says:
    June 22, 2010 at 10:33 am

    there are some subsidies, but they are actually really small.

    1: royalties paid to foreign countries and states are credited for tax purposes…. as it should be.

    if you paid for raw material, it has be considered as expense.

    2: research credit that is available to ALL INDUSTRIES is available to oil&gas. there is nothing special here.

    3: govt pays poor people for heat. that is welfare. not a subsidy to oil&gas. That money can be used for electric heat, even if it is hydro electric or other “renewable” source.

    4: investment credits available to everyone is available to oil&gas. where is the subsidy there?
    ——————

    Jeremy says:
    September 26, 2011 at 12:00 pm

    U.S. Sen. Charles Schumer, D-N.Y., is proposing to end what he says are $4 billion a year in tax subsidies to the biggest oil companies.”

    Firstly, all Oil Companies pay taxes on earnings just like any corporation. According to data found in the Standard & Poor’s Compustat North American Database, the industry’s 2009 net income tax expenses — essentially their effective marginal income tax rate — averaged 41 percent, compared to 26 percent for the S&P Industrial companies. The Energy Information Administration (EIA) concludes that, as an additional part of their tax obligation, the major energy-producing companies paid or incurred over $280 billion of income tax expenses between 2006 and 2008.

    http://dailycaller.com/2011/04/25/the-truth-about-americas-oil-gas-companies-part-i/ .

    Secondly, according to the ONRR, annual revenues from federal onshore and offshore (OCS) mineral leases are one of the federal government’s largest sources of non-tax revenue. In 2010, Royalty Revenue amounted to around $8 Billion

    http://www.onrr.gov/
    ————–

    Luke says:
    September 26, 2011 at 10:44 am

    Most of those $4.0 billion in “subsidies” are not specific to the oil & gas industry. They break down as follows:

    $1.7 billion in Domestic Manufacturing Credits: Applies to all production companies equally. A reward for creating/leaving the jobs in the US economy. You can argue whether or not they can move this production from the US, since the oil is located here, but it is clear that they can move the exploration equipment to anywhere in the world and ship the oil in. There is no requirement that oil used domestically must be produced in the US. So given that, what other industries should we strip this credit from?

    $1.0 billion in % depletion allowance: Applies specifically to the oil and gas industry as a mechanism for capital recovery. It takes the place of depreciating the assets in the ground. Of course we don’t like to talk about the dark side of this one, which is when oil prices are lower for a sustained period of time, it acts like an anti-subsidy, so this one can cut both ways and at time has. Easy solution is to use capital base instead of income. Over the long haul though, I doubt this equals $1.0 billion a year. Just $1.0 billion a year in the current price environment.

    $0.9 billion in foreign tax credit: This one again, applies equally to all. The dodgy part with this is classification of royalty payments as income taxes. Some foreign governments have converted royalty payments to income taxes, allowing for greater deductibility under US tax law. This, however, is not unique to the oil industry. So again, who else would you like to strip this one from?

    $0.8 billion in intangible drilling costs: This one is specific to the oil and gas industry. This however is not a subsidy. Period. Exclamation Point! At best, this is a shifting of tax payments to later years. It allows the oil company to deduct their exploration expenses immediately. When this rule was enacted, it actually made sense because 90% of those expenses were written off in the first year anyway because of the abysmal hit rate for new wells, as opposed to the alternative which is adding it to the depreciation base for a new well. Now that the hit rate is much better, maybe it’s time to rethink the break, but it will not provide an $0.8 billion dollar annual windfall. It might provided a short term difference, but after 4-5 years under the new rules, you’d be pretty much back to the same annual number for “tax breaks” resulting from intangible drilling costs.
    —————–

    chris y says:
    September 26, 2011 at 9:31 am

    “U.S. Sen. Charles Schumer, D-N.Y., is proposing to end what he says are $4 billion a year in tax subsidies to the biggest oil companies.”

    That $4B amounts to 1.6 cents per gallon of gasoline.

    Did Schumer also propose an end to Federal, state and local gasoline taxes to ‘even the playing field’?

    Did Schumer also propose an equivalent tax on solar and wind energy to ‘even the playing field?’
    —————

    Catcracking says:
    December 3, 2011 at 7:20 am

    One favorites of Pelosi is the reduction in royalities that was set up during the Clinton Administration to give companies an incentive to drill in deep water offshore in the Gulf when oil prices were low. Royalities are still paid but circa 20 % less. It was a good business deal for both sides at the time and improved for the drillers as oil prices rose. So now many of the tax and spend crowd want to change the contract and threaten those who refuse to comply with blackballing them from biding on new leases. How else can they make renewable energy sources look competitive?

    Another item frequently referenced is the accelerated write off of capital expenses to encourage investment and boost the economy that is offered to every other business.

    A third item is the foreign tax credits offered to all companies that bring foreign earnings back to the US.
    —————

    Janice says:
    December 3, 2011 at 7:36 am

    There is a hidden subsidy for both solar and wind power, one that could easily be avoided, but never will be because it is not politically expedient. The subsidy is the amount of money it takes to remove solar and wind farms once the parent company abandons them. It usually winds up being public money that is used, since the parent companies usually go bankrupt and are dissolved. It could easily be avoided if the parent companies were forced to post a bond equal to the amount it would take to remove the equipment, and restore the area. And that is a subsidy which coal and oil do not enjoy, because they are forced to remediate their mining and drilling sites.

    Roy UK says:
    December 5, 2012 at 8:33 am

    @Alexandre 7.47am

    Statement before the Senate Finance Committee

    Subcommittee on Energy, Natural Resources, and Infrastructure March 27, 2012
    FY2010 Electricity Production Subsidies and Support per megawatt-hour
    (year 2010 dollars)

    Natural Gas, Petroleum Liquids 0.63
    Coal (pulverized) 0.64
    Hydroelectric 0.84
    Biomass 2.00
    Nuclear 3.10
    Geothermal 12.50
    Wind 52.48
    Solar 968.00

    So subsidies per MWh to Wind and Solar are 100 – 1500 times the cost of subsidies to the Big oil. You didn’t really think your question through did you?

    Steve Keohane says:
    December 5, 2012 at 8:38 am

    Alexandre says:December 5, 2012 at 7:47 am

    I’d like to know where the Heartland Institute stands in the issue of fossil fuel subsidies. You know, being non-Big Oil and all…


    According to the link you provided $58B was paid globally in so called oil subsidies. In 2004, according to energy.gov, we in the USA used 140 billion gallons of gasoline, for which $70B in taxes at the pump was collected. And don’t for get the corporate tax on the wholesale sales, and the taxes paid by the oil employees to make the gasoline, etc. So where is the subsidy? Your so-called oil subsidies are smoke and mirrors, nothing more.

    John M says:
    December 5, 2012 at 9:11 am

    Steve Keohane says:
    December 5, 2012 at 8:38 am

    Regarding the whining about fossil fuel “subsidies”, it would be interesting to see Alexendre’s opinion on these “subsidies” listed in his source:

    Low-Income Home Energy Assistance Program (Petroleum) : 336 Million
    Fuel-Tax Exemptions for Farmers: 1 Billion (that’s a B)
    Strategic Petroleum Reserves: 1 Billion (Hell, the way that one’s been used, it should be charged back to the DNC as a campaign contribution)
    Low-Income Home Energy Assistance Program (Nat Gas): 1.7 Billion (that’s a B too)
    Credit for Investment in Clean-Coal Facilities: 370 Million
    Amortisation of Certain Pollution-Control Facilities: 200 Million

    Jeez, maybe they ought to count food stamps as a fossil fuel subsidy too, since they are used to buy food produced by those farmers who get those huge Fossil Fuel tax exemptions, or allow poor people to spend more to fill their tanks.

    ralfellis says:
    March 6, 2014 at 11:09 pm

    Another Geologist’s Take says: March 6, 2014 at 11:31 am
    The analysis to be fair needs also to consider the generous subsidies that the oil, natural gas and coal industries get from our governments. They are substantial and have been around for decades.
    _______________________________________

    Absolute tosh.
    In fact, that is tosh of the century.

    Those are not subsidies for the oil industry, they are investments.

    In reality, UK government finances depend in a great part on the huge taxes that they levy on oil and gas products. Thus they know that if they INVEST a little money to open a new and difficult oil/gas field, they will get their money back in spades when the product comes on-stream.

    With renewables, the government subsidises the infrastructure, and then CONTINUES TO SUBSIDISE the end product (electricity) through the Renewable Obligation Certificates – which are a shadow taxation scheme levied on your electric bills.

    In summary, the oil and gas industrues get no net subsidy, because their production pays back taxes that are greater than the subsidy BY SEVERAL ORDERS OF MAGNITUDE. They are net contributors to the government purse. In fact, many governments around the world would be bankrupt within the year, were it not for the huge profits from oil and gas.

    Steve from Rockwood says:
    March 7, 2014 at 6:07 am

    The IMF introduces the concept of “corrective taxes” for such things as CO2 emissions ($25/ton). These are a major part of their subsidy estimates. In fairness to the IMF they appear to lay these subsidies at the foot of government while you place them at the door of the oil companies.

    Mario Lento says:
    December 6, 2012 at 3:17 pm

    I found this goldmine of information on total subsidies. Does anyone have any comments on the validity of it? I could not connect to some of the links to the source references.


    http://www.instituteforenergyresearch.org/hardfacts-uploads/NJI_IER_HardFacts_ALLpages_20120423_v8.pdf
    [hard-headed, anti-green, 73 pages, not much on subsidies per se

  59. Jeremy says:

    World bank report

    http://siteresources.worldbank.org/INTTPA/Resources/SunleyPaper.pdf

    “The choice of tax rate reflects the typically higher economic rent in the petroleum sector.”

  60. ferdberple says:

    the potentially major fuel savings from switching from fossil fuels to renewable sources, such as wind and solar energy.
    ============
    nonsense. oil, coal and gas under the ground are free. nature placed them there and didn’t charge a penny. what costs money is to extract them and turn them into unusable energy. exactly the same problem as faced by renewables. thus, there is no money to be made in “fuel savings”.

  61. pat says:

    of course nuclear is being subsidised in the name of CAGW. wind & solar are the PR talking points to keep the greenies on side.

    30 June: UK Telegraph: Ministers must stop misleading consumers over true policy costs
    The Department for Energy and Climate Change must be honest about the gamble it is taking
    Ministers have guaranteeed the price they will pay green technologies such as wind farms and nuclear plants. That means that if the actual power price is lower than the Government has forecast, then the cost of subsidising these green technologies is much, much higher…
    http://www.telegraph.co.uk/finance/comment/telegraph-view/10937092/Ministers-must-stop-misleading-consumers-over-true-policy-costs.html

    27 June: Reuters: UK awarded too much in renewable energy subsidies – NAO
    Britain’s energy ministry awarded too much in subsidies to eight renewable energy projects in April – 16.6 billion pounds in total – meaning that consumers will pay over the odds for the electricity the projects produce, a parliamentary watchdog said…
    The subsidies were awarded under Britain’s new contracts-for-difference (CfD) scheme, designed to boost investment in new power plants in the country, particularly low carbon emission generation such as renewable power and nuclear plants.
    The Department of Energy and Climate Change (DECC) defended its payments…
    Last year the government awarded contracts under the scheme worth 16 billion pounds to EDF energy to help fund development of the Hinkley Point C nuclear project in southwest England.
    The European Commission is currently considering whether the contracts for difference are compatible with EU state aid rules.
    http://uk.reuters.com/article/2014/06/26/uk-britain-renewables-idUKKBN0F12ZR20140626

  62. kadaka (KD Knoebel) says:

    Attn: Willis

    http://www.iiasa.ac.at/publication/more_XO-13-043.php
    Energy Investments under Climate Policy: A Comparison of Global Models

    Authors: McCollum DL, Nagai Y, Riahi K, Marangoni G, Calvin K, Pietzcker R, van Vliet J,van der Zwaan BCC

    Program: ENE

    Publication Year: 2013

    Reference: LIMITS Special Issue, FP7 LIMITS project

    Available at http://www.feem-project.net/limits/docs/04.%20cce%20limits%20special%20issue_paper3.pdf

    Also mentioned at:
    http://www.worldscientific.com/doi/abs/10.1142/S2010007813400101
    “Volume 04, Issue 04, November 2013″

    Name and Authors and Volume and Issue/Number all match, there’s only the understandable year difference (organization release to publication in activist rag).

    I used the pre-made link at bottom of first URL. 391K, no problem, looks fine and complete.

  63. earwig42 says:

    Or as the NCDC would say…. “… our algorithm is working as designed”

  64. Paul Coppin says:

    These people are stark raving nuts. Worse, they actually believe this crap.

  65. mbur says:

    So, I go to buy a few ‘degrees’ somewhere and when they give me my receipt, they also give me ‘climate change’.
    Thanks for the interesting articles and comments.

  66. Political Junkie says:

    This may have been covered above:

    The definition of ‘subsidy’ in these reports is a serious problem. If farmers are given a reduced tax rate on fuel, the government pays out no cash but reduces potential future revenue. On the other hand, if a wind farm gets a subsidy in advance to set up operations, there is an actual cash outlay.

    Many of these reports [treat] the two conditions as equal. A layman sees them as being totally different.

  67. John G. says:

    The removal of a $500 billion subsidy is identical to the imposition of a $500 billion tax as far as a corporation is concerned. Corporations don’t pay taxes, they pass them on to their customers. So taking away that subsidy is the same as a tax on you the consumer levied through higher prices for fossil fuel products. Moreover I suspect these subsidies they want to eliminate are exactly the same as are granted many if not all businesses for various business practices and trade conditions and so singling out the fossil fuels industry to forego them is unfair and just a trick to punish a hated industry while raising the prices on fossil fuels to make them less competitive with renewables (though I doubt that would make wind and solar even close to being competitive).

  68. Catcracking says:

    “To limit climate change to 2° Celsius, low-carbon energy options will need additional investments of about US $800 billion a year globally from now to mid-century, according to a new study published in the journal Climate Change Economics. But much of that capital could come from shifting subsidies and investments away from fossil fuels and associated technologies. Worldwide, fossil subsidies currently amount to around $500 billion per year.”

    We still have people out there who believe that by some magic of spending even more money on expensive and often failed renewable sources such as wind and solar they will provide the energy level currently enjoyed by using fossil fuels. That is not going to happen unless Europe goes back to the middle ages. Did they not learn anything from Spain and Greece economic problems.

    Also the article is disingenuous since as others have already pointed out, there are insignificant subsidies for oil in the US. Note the reference is global where countries like Venezuela where the subsidies go to the poor people who could not afford $3.50 gasoline. Also China subsidies oil so that their industry can grow and sell cheap goods. Does anyone in their right mind really believe that these countries are going to kill their economies and divert their “subsidies” to build expensive “renewable”, expensive energy sources?

    Another point the fossil fuel business pays huge taxes throughout the world including exorbitant motor fuel tax throughout Europe and massive taxes and royalties to the US Treasuries..
    I doubt that this is included in the economic analysis in any way.

  69. RACookPE1978 says:

    An example of OVERSEAS (foreign/third world oil subsidies) that the writers are (deliberately) trying to confuse with US policies!
    Mexico’s Pemex to Spend $6B to Maintain Output at Cantarell (Oil Field)
    Rig Zone ^ | July 1, 2014 | Reuters

    “Mexico’s state-run oil company Pemex will launch a $6 billion investment in 2017 aimed at maintaining current levels of production at its once-supergiant Cantarell field over the next decade, a Pemex official said on Tuesday.

    Discovered in 1976, output from the offshore Cantarell field once supplied over 2 million barrels per day (bpd), or more than half of Mexico’s total crude production.

    But output at the field has fallen more than 80 percent since 2004 to hover around 340,000 barrels per day (bpd).

    The investment will counteract the natural decline of Cantarell by squeezing out an additional 100,000 bpd per year via secondary recovery over the course of a decade, said Miguel Angel Lozada, Pemex’s Cantarell administrator.

    Lozada said that Akal, Cantarell’s most productive sub-field, will be stabilized with the plan.

    “By doing this we can make sure that Akal’s output will remain steady at between 180,000 and 200,000 bpd for a longer period of time,” he said.”

  70. Pamela Gray says:

    So we will be using that same amount of money to subsidize non-fossil instead of fossil fuel. Okay. But the overall price will still be higher because it is more expensive to produce non-fossil fuel. If we change to non-fussil fuel here are your choices:

    1. Inflation will ensue as wages must rise to compensate for more expensive fuel in order to maintain standard of living.
    2. The standard of living will decrease for middle class and lower if wages do not increase.
    3. The upper middle class will likely reduce buying high-energy sucking leisure products, thus taking a bite out of manufacturing jobs.
    4. Even more manufactuing jobs will go elsewhere because other countries will be able to make stuff cheaper using fossil fuel.

    We win how?

  71. catweazle666 says:

    “Worldwide, fossil subsidies currently amount to around $500 billion per year. “

    A lie.

  72. Jimbo says:

    All I see are models and assumptions.

    We know that if we want to avoid the worst impacts of climate change, we need to drastically transform our energy system,” says IIASA researcher David McCollum, who led the study……..compared the results from six separate global energy-economic models,

    Sorry, but we don’t know. I barely read the press release and these alarming words pop out at me.

    Here is what we do know when economists get to work.

    BBC – 19 April 2013
    The student who caught out the profs
    This week, economists have been astonished to find that a famous academic paper often used to make the case for austerity cuts contains major errors. Another surprise is that the mistakes, by two eminent Harvard professors, were spotted by a student.
    http://www.bbc.co.uk/news/magazine-22223190

    BBC – 10 January 2014
    “Only days before the 1929 stock market crash, one of the best known economists of the time, Professor Irving Fisher of Yale University, announced that “stock prices have reached what looks like a permanently high plateau”. Even after the crash occurred, Fisher insisted it was only a market correction that would soon be over. Losing most of his own fortune, the distinguished economist was as deluded as nearly everyone else. In case you’re wondering who anticipated the crash, two who did were the mobster Al Capone, who described the stock market in the boom years as a racket, and Charlie Chaplin, who unsuccessfully pleaded with his friend, the songwriter Irving Berlin, to sell out the day before the market collapsed.”
    http://www.bbc.co.uk/news/magazine-25680144

  73. Jimbo says:

    The lead author of the paper is DAVID McCOLLUM. He worked on AR5.

    Dr. McCollum is currently authoring multiple chapters of the Fifth Assessment Report (AR5) of the Intergovernmental Panel on Climate Change (Working Group III). In particular, he co-coordinates the material on co-benefits and risks of climate change mitigation, linking mitigation to other sustainable development concerns (air quality, energy security, land and water use, biodiversity, energy access, and employment).
    http://www.iiasa.ac.at/staff/staff.php?type=auto&visibility=visible&search=true&login=mccollum

    He moves from failure to failure. From the failed global warming projections to the soon to failed economics hothouse Earth models.

  74. Jimbo says:

    When did taxes on fossil fuels turn into subsidies?

  75. John F. Hultquist says:

    Folks here seem to know the difference between a subsidy and a tax credit. My local progressive can’t seem to make the distinction. He spends a lot of time driving between places for his work and listens to National Public Radio (NPR) and is indoctrinated in the climocleptomaniac religion.
    ———————–

    Ivor Ward
    ferdberple RE: shopping

    Save and Free (as in, buy 1 get 1 free) are marketer’s magic words. Grocery store clerks faithfully will look at the cash-register receipt and tell you how much you have just saved. I look at it to see how much I have spent. I made the mistake (once) of explaining to the clerk about store pricing strategies (I have done retail) and why the amount she had just quoted to me was a bogus number. Apparently this is not an approved topic within the marketer’s handbook.

  76. “Given that energy-supply technologies and infrastructure are characterized by long lifetimes of 30 to 60 years or more, there’s a considerable amount of technological inertia in the system that could impede a rapid transformation.

    Ya think?
    Thanks, Captain Obvious.

    @Crispin in Waterloo but really in Singapore says: at 1:15 am +1

    @Frederick Colbourne at 1:27 am
    Notice that this study has apparently aggregated the national accounts of all countries in the world. This works for labor and capital although prices for labor and capital are distorted by barriers that restrict the cross-boundary flow.

    I would like to see how these subsidies are computed. I suspect that “subsidies” equal the difference between domestic prices for fossil fuels and world market prices.

    Frederick, I think you have hit a big part of it. There are countries where the government state owned oil companies sell gasoline and historically cheap prices to the public. It is either keep gasoline, bread, rice cheap, or suffer revolution.

    There is also a big element of subterfuge in these “subsidy” numbers.
    There was an Article in the WSJ, “The Energy Subsidy Tally”, Aug. 17, 2012, There the claim was “The natural gas and oil industry received $2.8 billion in total subsidies” On a discussion thread I dived into the numbers. Source: Direct Federal Financial Interventions and Subsidies in Energy in Fiscal Year 2010 (pdf)

    I concluded that about $ 1 Billion was listed as Percentage Depletion instead of Cost Depletion. [I disagree this is a subsidy, see note 1 below]. Then a big howler:

    Over the period 1978 through 2010 funding for energy-related R&D has totaled $121 billion, of which, $45 billion has been devoted to nuclear, $26 billion to coal, $26 billion to end use and electricity delivery and energy reliability, $20 billion to renewable energy, and $4 billion to oil and gas (Figure 2).

    OK, about 3% R&D to Oil and Gas over a period of 32 years.
    Funny, they don’t say how much went to Oil and Gas in FY2010.
    The bulk of that Oil and Gas R&D was for Oil Shale (not Shale Oil, OIL SHALE) in the Carter Administration!
    2010 R&D for Oil and Gas amounted to only $0.07 billion.

    I could find only 1 billion of the claimed 2.8. Another poster suggested the the missing $1.8 billion was in biofuels: From page xix of the report:

    Under the Volumetric Ethanol Excise Tax Credit (VEETC), blenders receive a $0.45-per gallon credit for each gallon of ethanol that is blended with gasoline for use as a motor fuel

    There was some reduction in excise tax that reduced the overall net, but this appeared to be the unaccounted for “oil and gas” subsidy — an inducement to the refiners to make them take ethanol from ADM and the agriculture sector. That’s a green subsidy! “Oh no its an Oil and Gas subsidy because the check is made to the refiners.” It’s an agriculture subsidy, “No the check is going to oil and gas companies who buy corn products.” It has elements of the “Dead Parrot Sketch”.

  77. Bob Weber says:

    More warmist happy-speak… To date there are no effective solar and wind replacements or any other alternative/renewable energy sources able to replace the warmist’s intended large-scale baseload reductions they wishfully and gleefully want to impose. So they want you to pay more for less available energy – more empty promises – just like with the ACA!

  78. Edit: Sorry, the bold tag should have been closed at the end of:
    “The natural gas and oil industry received $2.8 billion in total subsidies”

  79. Note 1 from Stephen Rasey at 8:21 am
    Why I disagree with the Premise that “Percentage Depletion,” or even “Excess Percentage Depletion of Cost Depletion” is an oil and gas subsidy. I’ll quote what I wrote at judithcurry on Oct. 22, 2012.

    However, I quibble that eliminating percentage depletion will see that 30% “subsidy” magically come to the Treasury. Percentage Depletion is a short form calculation to use instead of a more complicated Cost Depletion. It is to pay the owner of the resource for the decline in value of the asset as it is extracted and used up. If you eliminate Percentage Depletion, then those people “A” who use percentage because their costs of ownership were very low, will simply sell their mineral rights to Corporation B. “B” now has mineral rights acquisition costs at market value and an accounting department to do the cost depletion work. “B” will take Cost depletion instead of “A” taking percentage depletion. The Treasury might see less revenue than before the change. There are more people pushing paper, adding to expenses, taking their cut out of profits. TANSTAAFL!

  80. Catcracking says:

    The US alone spent $77 billion dollars on climate change between 2008 and 2013.
    The budget for 2014 is over $21 Billion dollars. 18 agencies are recipients of this pork barrel.
    This includes DOE among others.
    Can anyone tell me what energy breakthrough has been realized as the result of this expenditure?
    Does anyone thing spending more $$$ will make wind turbines, solar, or biofuels effective or will it continue to be just a subsidy for the Government buddies
    http://fas.org/sgp/crs/misc/R43227.pdf

  81. TimO says:

    Yea, it won’t cost us any more than our fossil-fuel economy….. IF we go back to living standards of the mid-1800’s like they want. Maybe they want to scratch out a subsistence-level existence and they have every right to go contemplate their navels in a commune somewhere but they shouldn’t force the rest of us to live in squalor….

  82. Jimbo says:

    Here are some abstracts showing what happened to the biosphere when the mean temperature of the Earth was over 5C – it did not collapse and the tropical rain forests thrived as well as biodiversity. The 2C target is BS. We need 3C ASAP, but how will we ever reach it?

  83. Kate Forney says:

    Alan the Brit says:
    July 3, 2014 at 4:31 am

    Many of the progs I know are also the kind of people who didn’t really have a problem with the first “final solution”.

  84. Berényi Péter says:

    The researchers note that their analysis of future investment costs does not attempt to quantify the potentially major fuel savings from switching from fossil fuels to renewable sources, such as wind and solar energy.

    Why? That’s silly. With savings not taken into account, an economic analysis is meaningless.

    Then, the most remarkable effect of switching from traditional sources to wind and solar is not decreased carbon dioxide emissions, but a huge increase in land use coupled with abandoning baseload power for intermittent sources. That is, large swaths of countryside are to be converted into industrial zones with a dense network of heavy duty roads, while the poor are forced to learn to live with frequent blackouts. Only wealthy households can afford to operate uninterrupted power supplies made of battery packs and a backup diesel generator. And, of course, no industrial process can rely on intermittent power, so industries either move out to countries with reasonable energy policy or operate their own power plants, at higher costs and lower efficiency than dedicated services.

    According to the authors some 43 trillion dollars have to be invested before mid century into a transition, which does not make economic sense.

    I am quite sure liquid salt breeder reactors operating at low pressure with passive safety, a hundred times better fuel efficiency than our Cold War Plutonium factories, no long half life isotopes left in waste and built in anti proliferation measures can be made cheaper than coal at a tiny fraction of that cost, especially because there used to be test systems already in operation many decades ago, subsequently killed off for political reasons. As one ton of ordinary granite (the default stuff continents are made of) contains as much fuel as fifty tons of coal + a hundred and thirty tons of atmospheric oxygen, and we have a thousand times better ores than that enough for millennia, from that point on one only has to let the market do its job with no special taxes, no subsidies, governmental loan guarantees or any other artificial incentive whatsoever.

    Until such time this mob wakes up and starts to push for alternative baseload power, which can only be provided by nuclear technologies, their suggestions lack authenticity and should be dismissed without further discussion.

  85. glenncz says:

    How much is that $500 billion in fossil fuel subsidies per gallon??
    Here is what I came up with help from Wikpedia.
    33% of world energy consumption is from oil. Let’s make the very rough assumption that’s about 170 billion in subsidies for oil. (assuming subsidy/energy unit is similar for coal/gas)

    91 millions barrels of oil are consumer per day * each barrel makes 19 gallons of gasoline * 365 days/year = 631,000 million gallons of gasoline consumed per year. (I know much of that oil is refined into fuel oil, but this is just a wild stab)

    Take 1700 million in subsidies and divide it by 631,000 million gallons of gasoline = .2 cents per gallon.of subsidies. Maybe someone smarter than me can check my logic?

  86. hunter says:

    The relentless banality of the AGW believers is annoying and disturbing.

  87. Roger Sowell says:

    Subsidies are the only reason nuclear power exists. It is far too expensive ant too dangerous to compete on its own merits.

    See US Nuclear Plants Are Heavily Subsidized at

    http://sowellslawblog.blogspot.com/2014/04/the-truth-about-nuclear-power-part-13.html

    See Price-Anderson Act Gives Too Much Protection To Nuclear Plants at

    http://sowellslawblog.blogspot.com/2014/07/the-truth-about-nuclear-power-part-25.html

    The French also heavily -and illegally – subsidize their nuclear power industry. See Part 11 in the series.

  88. Dave Wendt says:

    I would like to suggest a thought experiment in regard to the supposed wisdom of limiting GMT change to 2C. Let us suppose that an intrepid inventor, working away in his garage, has built a most wonderful machine. The capability of this wonderful machine is such that all one would need to do is push a button to turn it on and the GMT and the entire climate of the world would revert to what it was in the 18th century at the end of the LIA. No extra expenses or inputs are required. The question for consideration is; who would be stupid enough to vote to push that button?

    Admittedly there are a number of misanthropic statists who would probably relish punishing their fellow humans with the undoubtedly less friendly climate of that era, but IMHO I suspect we would finally have a climate question worthy of a 97% consensus and that consensus would be “No Way!”. I hope most people would demand the machine be immediately destroyed lest it, even accidentally, be turned on.

    If there is someone out there who would like to argue that the old climate would be superior to what we have today I am willing to listen but fair warning, for me personally, that notion will be an extremely tough sell.

  89. Berényi Péter says:

    Roger Sowell July 3, 2014 at 9:39 am

    Subsidies are the only reason nuclear power exists. It is far too expensive and too dangerous to compete on its own merits.

    That’s not true, for not all nuclear technologies are created equal.

    It may be so for our current Plutonium factories, generating electricity as a byproduct at less than 1% fuel efficiency with lots of long half life isotopes left in waste, with a high pressure core, which needs active cooling even offline. The only reason we have not moved ahead long ago was political, that is, Cold War demand for Plutonium, a dangerous substance, pretty useless for anything else but nuclear warheads, followed by a mindless environmentalist opposition, which refused to go into technological details, preferring word games instead.

    With a hundred times less nuclear waste for the same energy output, which does not have to be sequestered for a hundred thousand years, only for centuries, the picture is quite different. The reactor core can be operated at atmospheric pressure, with no physical possibility of an explosion whatsoever. Also, we can have passive safety, which means in case of malfunction the process simply stops on its own with no need for any further intervention, no meltdown can occur and nothing gets out into the environment.

    We could have developed the technology a long time ago, but the process was stopped dead by an unholy alliance between the military-industrial complex, Big Oil and their joint puppet, the environmental movement.

  90. Mike H. says:

    Dave Wendt,
    “Let us suppose that an intrepid inventor, working away in his garage, has built a most wonderful machine.”

    ‘Unintended Consequences’, it’s not just a bad idea, it’s the law!

  91. Willis Eschenbach says:

    Willis Eschenbach says:
    July 3, 2014 at 2:58 am

    Anyone know if there is a non-paywalled copy of this POS out there?

    w.

    kadaka (KD Knoebel) says:
    July 3, 2014 at 7:16 am

    Available at http://www.feem-project.net/limits/docs/04.%20cce%20limits%20special%20issue_paper3.pdf

    You da’ man!

    Thanks,

    w.

  92. MattS says:

    Doug says:
    July 3, 2014 at 12:13 am

    “Worldwide, fossil subsidies currently amount to around $500 billion per year.”

    I sure wish someone would show me those subsidies. I ran my $500 a month of oil production through turbotax, and when the domestic production tax credit came up, it was just about eliminated because the income is from oil and gas. Gravel, corn. political pamphlets, anything would get a tax break as long as it is not oil or gas. I imagine solar and wind would be treated a bit better.
    ======================================================

    Most of the US so called oil/gas subsides are either GAP accounting rules or general tax rules applicable to all manufacturers, and these are a tiny fraction of world wide subsides.

    The truth is most of those World wide subsides are supports to state run oil companies in oil producing countries that are run by either totalitarian governments or communist pseudo democracies. Good luck getting those countries to divert those funds.

  93. more soylent green! says:

    It depends upon what the meaning of the word “subsidy” is. Some definitions only include cash payments, others include tax reduction (http://www.investopedia.com/terms/s/subsidy.asp).

  94. ferdberple says:

    Big Oil and their joint puppet, the environmental movement.
    =======
    follow the money. big oil stands to benefit the most from the EPA war on coal. windfall profits for Big Oil in return for campaign contributions. and campaign contributions are tax deductible. pay once, benefit twice. sweet deal if you can get it.

  95. Willis Eschenbach says:

    Stephen Rasey says:
    July 3, 2014 at 8:23 am

    Edit: Sorry, the bold tag should have been closed at the end of:
    “The natural gas and oil industry received $2.8 billion in total subsidies”

    Fixed.

    Also, for details of how much of their claimed $500 billion in subsidies is from taxes, see my new post here. Short answer may surprise folks, it surprised me …

    None.

    w.

  96. Catcracking says:

    ferdberple says:
    July 3, 2014 at 11:55 am
    Big Oil and their joint puppet, the environmental movement.
    =======
    follow the money. big oil stands to benefit the most from the EPA war on coal. windfall profits for Big Oil in return for campaign contributions. and campaign contributions are tax deductible. pay once, benefit twice. sweet deal if you can get it.

    There is not a shred of truth in this comment. Your claim of a sweet deal is foolish if not totally uninformed. Follow the facts not the lies of the left!
    I know this is what the Left and the enviros want you to believe, but if you get the actual facts you would know this is post is void of truth.
    “Any donation to a political party, campaign, or action committee is not tax deductible. According to the Internal Revenue Service, “You cannot deduct contributions made to a political candidate, a campaign committee, or a newsletter fund.”

    Furthermore I don’t know who you believe “Big Oil” are but it is also part of the nasty smearing, name calling by the left because they only can deal in misinformation and distortions. Furthermore it is uninformed to believe that US Oil companies are happy with the war on coal since they know as you should that they are next in line for destruction. The EPA and the administration are doing everything in their power to put Oil companies out of business with biofuels.

    Also It is foolish to believe that liquid fuels for transportation are interchangeable with coal for electricity generation. Very little electricity generation comes from oil. Electric powered cars have a long way to go to replace gasoline/diesel. The only fuel that is practical for use by transportation and electricity generation is natural gas. It would take decades and huge subsidies to replace the auto filling stations infrastructure with electricity.

  97. Billy Liar says:

    Roger Sowell says:
    July 3, 2014 at 9:39 am

    Your record is cracked.

  98. 3x2 says:

    “A Trillion here, a Trillion there, pretty soon, you’re talking real money.”

    Martin Durkin had a good illustration (Britain’s Trillion Pound Horror Story) of a Trillion (£). He claimed that if you made a stack of a Trillions worth of £50 notes it would be some 6.5 thousand miles high.

    Now perhaps it’s late here in England and I’ve had a long day but 79 Trillion would get us to The moon and back.

  99. Col Mosby says:

    Roger Sowell July 3, 2014 at 9:39 am
    “Subsidies are the only reason nuclear power exists.
    It is far too expensive and too dangerous to compete
    on its own merits.”
    Before I start laughing uncontrollably at the magnitude of sheer ignorance displayed in that sentence, I continue in a rational manner ..
    The real facts are that nuclear power is close (and sometimes is, depending upon the price of coal) to being the cheapest form of power generation – only coal is cheaper, but insignificantly so. And nuclear is , by far the safest form of power generation as shown in this graph Accidents generating electricity per
    Giga Watt electric year 1966 to 1996
    Fatalities Injured
    LP Gas 3.1 15
    Hydro 0.9 0.2
    Coal 0.35 0.07
    Wind 0.17 0.35
    Nat Gas 0.09 0.21
    Nuclear 0.009 0.11
    At Fukushima, no civilian nor worker received radiation even remotely close to the level considered unsafe, although that level is far below the natural background radiation and may loactions around the world.
    At Chernobyl there were aproximately 30 worker deaths during the reactor meldown. The levels of radiation received by civilians was only 1.6 millisieverts/year above the typical background radiation of 6/yr. Many locations around the world have background levels far higher than that, without any health effects – SouthWest France,for example has levels of 80/yr, Sweden 18/yr and Ramsur Iran 700/yr!! with no apparent health effects.
    Current Gen 3 nuclear reactors are deemed at least 100 times safer than Gen 2 reactors by the NRC, and Gen 2 plants were safer than any other means of producing power.
    Cost of a kWhr generated by nuclear power is easily calculated from the price of uranium fuel (.75 cents /kWhr), ops and maintenance (1.65 cents/ kWhr), lifespan of plant (minimum 60 years for Gen 3), cost to build reactor ($5.5 billion, which could be paid back at .9 cents/kWhr for 60 years). decomissioning costs (varies but less than .1 cents /Kwhr) , nuclear waste storage (0.1 cents/kWhr – and is too much according to recent court judgement) , interest on build loan (if any)
    .3 cents/kWhr. All based on 60 year lifespan, which is conservative, so those number estimates are high.They produce cost per kWhr of 3.8 centst/kWhr, as opposed to the estimated price of wind (18 cents/kWhr).
    Nuclear fuel costs have declined over the past 35 years. And the availability of uranium is essentially unlimited. The is especially the case when fast reactors come online in quantitiy – the run will stop shining and solar power and wind power will cease to exist before we ever run out of uranium. The oceans provide an unlimited soucre, which can be extracted very economically for fast reactors.
    China is currently building around 30 nuclear plants, some in country, for around $4 billion, and some by Westinghouse for roughly $5 billion apiece. No subsidies are given. South Carolina Gas and Electric is building two Westinghouse AP 1000 plants and they are currently running ahead of schedule and below cost, which is currently estimated to be between $5 and $6 billion. The company received NO govt subsidies. Nor did Georgia Power and Light, which is also bulding two AP1000 plants. I know what prices are being paid for many of the 75 new nuclear plants being built around the world or contracted for future build -well over 30 nuclear plants are scheduled and contracted for in Middle Eastern oil producing countries. Saudi Arabia has contracted for 25 nuclear plants, for example. England hss scheduled roughly 20 new nuclear plants to be built in the next decade. Russia and Eastern European countries also have scheduled new nuclear plants and also Finland, Sweden, Latvia, Poland, etc
    For a technology claimed by Sowell to be non-competitive, an awful lot of countries are choosing nuclear as THE prime power generator.China has plans for 400 reactors by 2050 and 1600 by 2100. Maybe Sowell should write these country’s energy ministers and clue them in on the big mistake they are all making. Sowell might also manufacture some statistics to convince them that they are also building death traps. Of course, this may require a few lies sprinkled about here and there. Well, perhaps more than a few, and perhaps more plausible than his previous fare.

  100. Roger Sowell says:

    @ Col Mosby July 3 at 2:09 pm

    Every statement you made is false, but it is typical of the mis-informed nuclear power cheerleaders.

    Debunking such claptrap is why I wrote the Truth About Nuclear Power articles. 25 are published now with 5 more to go.

    This is not my opinion, the articles are solid fact-based with references cited.

    Feel free to try to refute the facts. Mere arm-waving, as you did at 2:09 pm, makes you one who parrots the industry falsehoods.

    I suggest you read Part 2 and Part 3 for facts on nuclear plant costs and electricity pricing.

    Part 10 shows they do not last for 60 years.

  101. Arno Arrak says:

    Very interesting. So 100 countries have signed up to keep global temperature rise below 2 degrees Celsius by mid-century, which will require an additional 800 billion dollars a year to accomplish. From this we may deduce that they know exactly what the climate will do between now and mid-century, how to change this, and how much we must pay for their delusionary project. They get away with this stupidity by completely ignoring the science involved. Let’s take a look at what science has to say. First thing when you talk about climate science you have to make sure that all climate models are thrown out before you start. James Hansen started this climate model craze in 1988 when he gave his propaganda talk to the United States Senate. He predicted global temperature between 1988 and 2019 and his results for “business as usual” climate were all atrociously wrong. Today, 26 years later, they are using supercomputers and are writing million line code for their models but their results are no better than Hansen’s were 26 years ago.All you need to convince yourself of this is a CMIP5 house duster full of climate threads. Not one of them gets even close to the twenty-first century data which shows absence of warming. 21st century lines up as a horizontal straight line while all computed threads have an upward slope. It is easy enough to see where that stupidity comes from. They have an obligate greenhouse warming built into their code that equates carbon dioxide rise with global temperature rise. In the real world, despite a 17 year absence of warming, atmospheric carbon dioxide has been steadily increasing and these dopes think that this means warming. It is time to admit that climate modeling does not work and shut it down completely. Without these deceptive models and their incompetent operators we can say quite a few things about climate. For one thing, the assumption that the greenhouse effect is real goes back to James Hansen. In 1988 he reported to the Senate that he had proved the existence of the greenhouse effect. He first showed a temperature curve that goes from a low in 1880 to a high in 1988. That high peak, he stated, was the warmest temperature in the last 100 years. There was only a one percent chance that this could happen by accident, he said. Since this ruled out chance, it followed with 99 percent certainty that the warming had to be greenhouse warming, thus proving that the greenhouse effect had been detected. But there is a problem with this 100 year warming when you look at his data. The problem is that it includes a non-greenhouse warming that started in 1910 and ended in 1940. It is quite certainly non-greenhouse warming because there was no parallel increase of carbon dioxide as required by the laws of physics. And you cannot use a non-greenhouse warming to prove that the greenhouse effect is real. And if you then remove all years starting with 1940 from his graph you are left with a high end that has a wiggle: 25 years of cooling followed by 23 years of warming. No way can this be used to prove the existence of the greenhouse effect. But Hansen said he detected it and has been getting away with this for the last 26 years. This leaves the greenhouse effect without any empirical proof. Its existence now depends on theory, specifically the Arrhenius theory of greenhouse warming. The fact is, however, that the Arrhenius theory cannot explain what real world temperature does.There has been a “pause” in warming for the last 17 years despite the fact that carbon dioxide is steadily increasing. From the latter fact Arrhenius theory predicts warming but nothing whatsoever has happened for the last 17 years. If your theory predicts warming and nothing happens for 17 years you know that this theory is no damn good and belongs in the waste basket of history. There is a place for it there right next to phlogiston, another failed theory of heat. Problem with Arrhenius is that it can handle only one greenhouse gas, namely carbon dioxide, but the real atmosphere contains more. Of those, carbon dioxide is not even the most important one. Water vapor is, and there is 25 times more of it, on the average, than carbon dioxide in the atmosphere. The only greenhouse theory that can handle a mix of several greenhouse gases simultaneously absorbing in the infrared is the Miskolczi greenhouse theory (MGT). According to MGT water vapor and carbon dioxide establish a joint optimum absorption window in the IR whose optical thickness is fixed at 1.87. If you now add carbon dioxide to the atmosphere it will start to absorb, just as the Arrhenius theory predicts. But this will increase the optical thickness. As soon as this starts, however, water vapor will begin to diminish, rain out, and the original optical thickness is restored. As a result, no temperature rise takes place while carbon dioxide steadily increases. This is the situation we have today: warming has ceased but carbon dioxide is steadily increasing. This is what happens if natural warming does not confuse the issue. It is not the first time it has happened either. In 2010 Miskolczi used NOAA database of weather balloon operations that goes back to 1948 to study the absorption of IR by the atmosphere over time. And found that absorption had been constant for 61 years while carbon dioxide at the same time increased by 21.6 percent. This is an exact parallel to what is happening today. Clearly greenhouse warming, and with it, AGW, simply do not exist. You do not need 800 billion dollars to keep the climate cool for mid-century because MGT tells us that the present “pause” is not a pause but a new normal likely to continue. And this, by the way, makes any earlier greenhouse warming nothing more than a pseudo-scientific fantasy, reported by over-eager climate scientists to prove the existence of their magical greenhouse effect.

  102. kadaka (KD Knoebel) says:

    From Arno Arrak on July 3, 2014 at 6:44 pm:


    Clearly greenhouse warming, and with it, AGW, simply do not exist.

    And this, by the way, makes any earlier greenhouse warming nothing more than a pseudo-scientific fantasy, reported by over-eager climate scientists to prove the existence of their magical greenhouse effect.

    Wow, there are still people who believe there is no greenhouse effect.

    For rational people who are interested in how the greenhouse effect works, including how water and carbon dioxide each play their part, there’s an informative 5-part series here on WUWT, Visualizing the “Greenhouse Effect” by Ira Glickstein. This is the link to the last one, at the beginning are the links to the earlier parts.

    http://wattsupwiththat.com/2011/05/07/visualizing-the-greenhouse-effect-light-and-heat/

  103. ristoi says:

    “Worldwide, fossil subsidies currently amount to around $500 billion per year”
    This needs more investigations but as first guess I claim it is some kind accounting hoax. Here in Finland quite same diesel oil is sold for diesel cars with price tag 1.500€/l and for domestic heating use with price tag 1.000€/l. Difference is the extra tax for traffic fuels. So I think those subsidies are calculated so that if tax is below max tax the difference is subsidy.

  104. Alan the Brit says:

    Kate Forney says:
    July 3, 2014 at 9:06 am

    Alan the Brit says:
    July 3, 2014 at 4:31 am

    Many of the progs I know are also the kind of people who didn’t really have a problem with the first “final solution”.

    Now that is disturbing to say the least! :-(

  105. P@ Dolan says:

    I stopped reading when they mentioned that their models showed— Bah. Look what their climate models show: their own desires and prejudices. Money spent on alternate energy in the US went down a black hole (can you say, “Solyndra”? Just one of around 29 “green” projects and if I recall the last count, all but 3 had gone belly up already, and the last three were on life-support).

    There may be a return on the investment in terms of research some day, but presently the field is too politicized, and like AGW theories, appears to be the province of bureaucrats, not scientists.

    But most importantly, even if we accept their assertions about subsidies to fossil fuel industries at face value, the clear implication that the money can simply be refocussed on “alternatives” is fatuous. What they’re really saying is that the rest of us would have to trust that they were correct and take the risk of doubling what we’re currently spending in subsidies on fossil fuels in order to add that much or a little more to spending on alternatives, in order to see a return on that by 2025, and they don’t say what that return will be.

    Will it be an exact replication of our current civilization, but powered by alternatives? Or will it be the Liberal/Progressive dream that, like the Galladrim of Tokien’s The Two Towers we live in the trees, and rely little on any energy?

    I’m a believer in the free market, and don’t believe in subsidies. I’ve no doubt that many such can be found to justify a claim that “Worldwide, fossil subsidies currently amount to around $500 billion per year.” Cato Institute prefaces it’s Research section on Energy with the following paragraph:

    Energy, like other goods and services in the economy, should be left to consumers and entrepreneurs in the market, not “planned” by governmental bodies. In fact, the long history of U.S. oil, gas, and electricity regulation, taxation, and subsidization makes abundantly clear that shortages and energy crises are engendered by government intervention, not market failure.

    and I know I’ve read about regulations which provide tax breaks and the like which are a form of subsidy; I have not trouble accepting the fact that energy is subsidized heavily around the world. The figure they quote is probably an idiot-meter indication; but the fact is, I’m sure the figure is large—and shouldn’t exist at all.

    But I think we can all recognize that if that’s the way it is now, you can’t simply kick the props out from under the system and not expect catastrophic results. We don’t want ANYONE on subsidies— And if we’ve got fossil fuels on that much, the answer is not to subisdize alternatives to the same tune or more! That’s the quickest way to kill any real potential it may have! Again, look at Solyndra—those who founded the corporation, by appearances, simply took the money and ran. What if there were a few scientists/engineers in there with the nucleus of a REAL solution to something of benefit to us all? It’s lost now in the wreckage caused by rent-seeking profiteering through gov’t subsidies. History is replete with examples of such government largess ruining an idea because those running things were interested in money, and NOT in saving the world or whatever was the stated motto of the company they fronted.

    Witness the true costs of cars like the Prius, Volt, or Tesla—those are examples of what this article advocates. “Give us more money, and we promise, cross our hearts, to replace fossil fuel use!”

    My answer is, if they can build a better mousetrap, people will buy it. They don’t need the government to hand over tax money if they’re correct. The free market will make them a success if they’re correct. And if they’re incorrect, government subsidies will mask their failures until the money is gone, at which time, like those seeking grants to study the “causes” of “Man-made” warming—who conflate any and ALL warming, plus any natural climate variations and the occasional disasterous natural even to man-made problems—they’ll simply go back, hat in hand, and beg for more, and like as not, politicians will throw good money after bad for many, many reasons from rent-seeking to good-old-boy networks to political backscratching to protectionism to you name it.

    This is the same old argument that global warming is real! and dangerous! and we must stop it! and it’s all our fault, anyway! and we’re not asking for anything more than you’re already spending!!!

    Nuts to that.

    Prove that warming will be harmful to mankind first. ANY kind of warming. This isn’t even putting the cart before the horse, it’s putting it in the next county—they haven’t even proven that there’s a reason to prevent warming if we could.

  106. Ginger says:

    Great post Willis. Thanks.

    The extent to which our administration, politically-correct scientists and the media will go to deceive is depressing.

  107. Ginger says:

    Under their definition of “subsidy”, the Obamaphone program subsidizes companies such as Apple, Inc. and the like to the extent of 2.2 billion dollars per year.

    In a recent quarterly SEC filing, Apple reported that it had $158.8bn in cash and cash equivalents plus short- and long-term securities.

    US Trust reports that the cash-strapped American government has reserves of just $48.5bn.

    Where is the outrage from the left regarding the Obamaphone subsidy program.

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