Mining Affairs Forum June 27,
2009
By Ken Thornberg
"Obama's Energy Plan is an Obamination"
When one studies the history of the United States, one finds
several reasons we have become the wealthiest nation on earth.
With our spiritual heritage being the underlying foundation,
we have sought limited government, secure property rights, a
free-market capitalist economic system, a relatively stable
currency (moreso when it was supported by precious metals),
and an abundance of available energy.
All of these are of course under attack from our federal and
many state governments, being fed by an increasing moral decline
in our nation. However, a successful assault on the access we
have to the energy that powers our economy would devastate our
nation-even if we did everything else right. Unless we are satisfied
with a Third World standard of living, we require copious amounts
of reliable energy.
Well, the Obama administration plans to turn convention wisdom
on its ear and instead of creating opportunities to increase
energy supplies, he wishes for us to decrease energy usage and
replace our present reliable energy supply with solar and wind-energy
alternatives. He has come up with the "New Energy for America"
plan in six sentences. I would like to take our readers on a
tour of each of these six and allow you to determine for yourselves
if you believe this holds the key to our energy future. At the
beginning of each segment, I will quote his plan verbatim.
The Pump Plan
" Provide short-term relief to American families facing
pain at the pump.
The Obama administration plans to confiscate a "reasonable
share" of record-breaking "windfall profits"
of the oil companies and give it to American families as an
"emergency energy release"--$500 per individual or
$1000 per couple. While everyone will cheer momentarily at receiving
another check from the government, it will no doubt have some
negative effects in the long run: increase demand, harm innocent
stockholders and pension funds, and reduce capital needed to
seek out new reserves. Obama's crew wants to increase the Corporate
Average Fuel Economy (CAFE) by 2016 to 35.5 miles per gallon
from the present rate of 27.5 for cars and 24.0 for light truck.
The engineering to accomplish this feat comes with a healthy
price tag of $1,300 per vehicle, according to the administration.
However, engineering and fuel economy experts predict a rise
between $5,000 and $12,000! Dr. Leonard Evans, author of Traffic
Safety, concludes that because of lighter vehicles required
to meet the CAFE requirements, "CAFE kills, and higher
CAFE standards will kill even more."
Oil Consumption Reduction
" Put 1 million Plug-In-Hybrid cars-cars that can get up
to 150 miles per gallon - on the road by 2015, cars that we
will work to make sure are built here in America.
Today we have cars such as the Toyota Prius that is a hybrid
auto, but most do not know that it is
not a Plug-in-Hybrid Electric Vehicle (PHEV). Today's hybrids
have batteries which are sued for low-speed operation. Toyota
just happens to be the first competitors in the plug-in-hybrid
market in 2010 with a car which can travel 7 miles on battery-only
power. The GM Volt, hoping to also hit the floor in 2010, could
get 40 miles per charge, with a price tag of $42,000. But then
Obama wants to gives buyers a $7,500 tax credit, paid for by
you and me.
Now here is the catch. As of 2006, there were over 240 million
vehicles registered in the U.S. The one million PHEVs sought
by Obama amount to 0.4% of the total passenger fleet. The decrease
in petroleum-product usage we could expect (if these vehicles
never used a drop of gas) would amount to virtually nothing.
Is this simply to placate the "green" community or
what?
" Within 10 years save more oil than we currently import
from the Middle East and Venezuela combined.
Who wouldn't give a "hurrah" to that statement? These
two areas, both hating our guts, provide
about 1.34 billion barrels of oil per year-some 37% of the 3.6
billion barrels in total imports; it amounts to about 19% of
total consumption. Where do we begin to increase supply or decrease
consumption to offset roughly one-fifth of our oil consumption?
Well, the PHEVs could, considering they never use a drop of
gas for the road, save us 0.5% at best.
What about ethanol? The U.S. is very near the "ethanol
bubble" of production; in fact 27 ethanol producing factories
have filed bankruptcy in the past few years. While it can make
farmers rich, it has made Third World nations very unhappy,
as they cannot find enough corn to manufacture tortillas and
other corn-based products. It has also helped cattle and pig
feed skyrocket in price. The poorer mileage from ethanol-based
gasoline is also too corrosive for pipelines, so imagine what
it does to our engines? Now Tyson Foods is planning on building
a plant that renders chicken fat and turns it in diesel fuel.
However, to meet Obama's planned 6 billion gallons of biodiesel
by 2030, we would need to render the fat from 75 billion chickens
annually. Uh...I don't think so. The other alternative here
is to allow oil companies and others to convert coal into liquid
fuel, but under this administration, that is probably unthinkable-they
want less, not more.
More Renewable Energy
" Ensure 10% of our electricity comes from renewable sources
by 2012 and 25% by 2025.
Obama said on December 20, 2007 that he is not a nuclear power
proponent." It is odd that the liberal and socialist leaders
of Western Europe are adopting nuclear at an increasing pace.
Obama favors the capture and storage of CO2 with coal, but since
that is still in experimental stages, that option it out at
this time. And since geothermal is not a serous alternative
in his mind, it leaves only wind and solar as potentials in
this category. What else is there?
" Help create five million new jobs by strategically investing
$150 billion over the next ten years to catalyze private efforts
to build a clean energy future.
Let's talk solar. Solar is presently only a tiny fraction of
1% of U.S. energy production and it is
losing ground. If we are to supply even 10% of say, East Coast
energy needs, during sunlight hours we would need a transmission
capacity of 35,000 megawatts. The East Coast is the industrial
HQ for the U.S., is it not? Would we build these solar plants
in an area that has only 120 clear days a year? No, it would
have to be in America's deserts that get 280 clear days per
year and transported on 70 transmission lines crossing hundreds
of thousands of people's property to make it there. There is
only one problem: while the Northeast wakes up with its coffee
pots and showers, it's dark in California and Arizona. Electricity
must be generated at the time it is used, so if the sun is not
shining, what do we do? Our utility companies say that they
must have a reliable source of energy for when the sun is not
shining. Also, electricity cannot be delivered instantly-there
is indeed a lag time. Solar as a possibility makes for good
rhetoric on television and for obtaining votes, but it doesn't
work. I've discussed other financial problems in the past year
in another column-look that column up and you will discover
that it is out of range of anyone's pocketbook. So it is clear
that we would continue having conventional power plants no matter
what. In determining what it would take to save an average consumer
$20 in electricity costs, the cost to the consumer would be
$550 for a panel plus installation. It would take a long, long
time to recoup the costs! The typical home would need 58 such
panels with installation, costing an average (today!) of $42,000.
You would have to add batteries, an inverter (to change it from
DC power from solar panels to AC so you can run your appliances),
and other controls, the cost has now risen to $62,000! Of course
there is the $2,000 annual maintenance costs. All this to save
$1,000 in utility costs so you can feel good with President
Obama in saving our planet.
Now let's talk wind. I've discussed wind generation in past
columns also, so I will not be repeating anything I have said
earlier. Grid manager Bob Benbow said on an NPR interview that
he is concerned about wind becoming a significant portion of
his grid because managing it will cause him major problems.
The reason Benbow gave is instability. The limit of wind power
and/or solar that can be added to a grid is about 9%, after
which there becomes a danger of losing control of the network.
According to Benbow, the 20% spoken of by the president is not
reasonable. If the sun is not shining, or the wind blowing,
that resource is not available. When does the wind not blow?
During summer months when the demand is the greatest. When does
it blow? At night, when you're sleeping and don't' need it.
Obama talks about the Danes and how they use wind energy, but
get this: their kwh cost is FOUR times America's average and
84% of its wind-generated electricity was sold at a loss. Six-thousand
wind turbines provided only 3.3% of domestic electricity in
Denmark, the nation Obama uses to tout the success of it.
What about Obama's intention of providing 5 million new jobs?
Spain tried it first. Obama speaks of Spain providing 30% of
its power through wind, but a study at Juan Carlos University
points out that the U.S. should expect a LOSS of at least 2.2
jobs for every one created!!!!! This did not come from some
conservative think-tank in Washington, D.C., but from a prestigious
Spanish university. So what if we create 150,000 if we turn
around and lose 330,000? What do we subsidize those job losses
with? It cost Spain 5.28 jobs lost plus over $800,000 for every
green job created. I hope we aren't as stupid as the Spanish
were in their "experiment." Why is the Obama administration
ignoring this; if we have that information, you can be sure
they do!
Cap and Trade
" Implement an economy-wi8de cap-and-trade program to reduce
greenhouse gas emissions 80% by 2050.
You can spell "cap-and-trade" r-a-t-i-o-n-i-n-g. This
scheme is designed to satisfy the global
warming enthusiasts. Obama currently supports a carbon-emission
"auction." What this really means is that companies
would purchase a finite (and who decides this number, but the
socialists Obama has hired to reduce America's economy to that
of the Third World) number of "carbon credits." That
would allow a firm to put carbon dioxide into the atmosphere.
This is conjecture, but so far it is the only thing spoken of
publicly. The credits would not be permanent, but renewable
so that the administration could reduce the number of credits
annually, thus either putting companies out of business or hiking
the consumer's cost into the ozone. Thus, rationing. All under
the guise of saving the planet from something it does naturally
on its own!
The worst thing is that it completes the cycle of Obama's socialism.
It puts American industry under total control of the government
and makes trading credits incredibly profitable. In the end,
it is both an incredible tax and bureaucratic burden on Americans.
This entire saga, about to unfold, will create the bureaucracy
of all bureaucracies and trap America into a cycle of more government
and less freedom. Did the voters who put Obama into office have
a clue about this plan? I doubt that even 1% had a clue, as
they simply voted for "change." Well, they are going
to get it and they won't like it, but the slick tongue and speech
of this president will be able to cover it up. Only those with
the wisdom of God will be able to see through the rhetoric.
As one writer rused, "The Obama energy plan will likely
be used as a case study in college classes generations from
now as a lesson explaining how government interference in the
markets leads to the economic downfall of a civilization."
Well, I agree…unless you and I write our federal and state
representatives and demand that they not allow rhetoric to deceive
them into bringing America down. If you live in a state with
Democratic leaders in Congress, it is especially crucial that
you contact them with these facts, for even they do not know
the truth of this ploy. For America's sake and that of our children
and grandchildren, please make your voice heard and pass this
on to others before it is too late.
