Wednesday, July 30, 2008

How to stay awake on a long drive

After an exhausting couple of days talking about economics and the future under various scenarios with Richard Douthwaite up in Westport, I was faced with the 4.5 hour drive from Castlebar home to West Cork. This was 6pm after having my windscreen repaired as the car had been broken into while partked at the Two Mile Inn in Limerick the day before...

Wondering how on earth I was going to keep awake I started listening to some TED talks and on came Bjorn Lomborg. Mr Lomborg's book, The Skeptical Environmentalist written in 2001 left me flummoxed as to how a seemingly intelligent person could treat environmental problems in isolation taking no regard for the interconnectedness of all things. Mr Lomborg makes a very strong case that all is well and getting better in almost every area of the environmental by taking a restricted view of the data and making statements about the future as though he had been there. You are left saying, yes but.......

Here is his conclusion in the energy chapter written in 2001.

The evidence clearly shows that we are not headed for a major energy crisis. There is plenty of energy.
We have seen that although we use more and more fossil energy we have found even more. (no, we are discovering only 1 barrel for every 4 we use) Our reserves - even measured in years of consumption - of oil, coal and gas have increased (over what period?). Today we have oil for at least 40 years at present consumption (assuming we can bring it to market as fast as it is required, which is the whole point about about peak oil), at least 60 years' worth of gas , and 230 years' worth of coal (reserves of coal are shrinking).
At $40 a barrel (less than one-third above the current world prices), shale oil can supply oil for the next 250 years at current consumption (because of the energy required to extract shale oil, it is not a matter of price but of energy in vs. energy out and shale oil has always been marginal.  Using energy for such low returns rapidly depletes remaining supplies of fossil fuel energy). And all in all there is oil enough to cover our total energy consumption for the next 5,000 years (how?). There is uranium for the next 14,000 years (that includes all the uranium in sea water I presume). Our current energy costs make up less than 2 percent of the global GDP (only if you measure direct energy costs and ignore embedded costs) and , so even if we were to see large price increases it would still not have significant welfare impact (it would seem not) - in all likelihood the budget share for energy would still be falling.

[He then talks about the promise of renewables]

In the longer run, it is likely that we will change our energy needs from fossil fuels towards other and cheaper energy sources - maybe renwables, maybe fusion, maybe some as-of-now unimagined technology. Thus, just as the stone age did not end for the lack of stone, the oil age will eventually end but not for lack of oil. Rather, it will end because of the eventual availability of superior technology. 

Well that's okay then. We must be imagining all the current concern about increasing energy prices.

Still 7 years, his thinking must have matured?

His TED presentation goes something like this. We can't solve all the world's major problems at once so we need to prioritise. We (a select bunch of economists including 4 Nobel Laureates) have ranked these problems according to the solutions cost-effectiveness. Bottom of the list is Climate Change. He accurately predicts that his audience may be a bit surprised by this! The reasoning goes like this. It is going to cost $150bn a year to reduce climate change and all models show that it is only going to delay climate change for 6 years. With half the money we can solve all major basic problems in the world, so doesn't it make sense to do that instead? Even in the most pessimistic scenarios, the UN estimate that the average person in the developing world by 2100 will be about as rich as we are today. Much more likely they will be 2-4 times richer. So do we want to spend a lot of money helping, 100 years from now, a fairly rich Dutchman or do we want to help real poor people right now?


Fuming about this kept me going all the way home without a break!

5 comments:

Liam said...

4 and half hours...

Ah you Irish are funny with your "long" drives... reminds me of when my aunt came over to holiday in Florida... we lived up in Indiana and wanted to know if we had time to "pop down" for a visit... "Uhh... Auntie B, it's a 20 hour drive..."

My strategy is the alphabet game or eating little snacks like peanuts or something. If you aren't familiar with the alphabet game... well there's a couple of different ways to play. You can either find things outside that start with the letters, find the letters themselves on signs, or the hardest is finding words on signs that begin with the letters.

Your mileage may vary.

Phoebe Bright said...

I use the alphabet game to get to sleep - Find flower names starting at A etc. Might not have the right associations for me.

How many alphabet games does it take to do 20 hours driving?!

Liam said...

Uhh... way too f'ing many.

Wag the Dog said...

Ever since his TED talk, his reasoning concerning global warming has become more and more flawed. This is especially disappointing given that he's a statistician. For example, last year he compared the cost of bed nets for fighting malaria with the total cost of climate change mitigation -- such comparison only makes sense if the only problem that fixing climate change would cure is the spread of malaria.

He made another flawed comparison last November on the Financial Sense news hour where he pointed out that the historical rise in average temperatures of major cities already exceeds the global average rise predicted for the entire planet so we can easily adapt to the worst of climate change. This brings to mind that joke about the statistician with one foot in a roaring oven and the other foot frozen in a block of ice, and saying on average he feels fine.

And in his latest Wall Street Journal article he applies cost/benefit analysis only to the mean expected temperature rise, totally ignoring the significance of highly costly damages occuring at lower (but still significant) probabilities. In the light of his more recent statements, I think his Copenhagen Consensus is about rationalising why we should be protecting free markets against environmentalists, rather than anything to do with saving the planet.

Phoebe Bright said...

I occasionally wonder if this guy isn't actually asking us to challenging his thinking. So far he has been rather disappointed at the number who are taking what he says at face value so he is getting more outrageous in the hopes of getting us to twig this his arguments are specious!