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Liquid Terror?

The Eugene Register-Guard has a good article (and sidebar) today on the proposal to build a liquified natural gas port at Coos Bay, Oregon. Liquified natural gas is safe and clean, except in the very unlikely but not impossible event of a well-planned and executed attack. Then, it becomes a massive threat. Each average-sized marine LNG tanker holds as much energy as 50 Hiroshima-sized bombs.

We discuss the issue in Cascadia Scorecard 2005 (1 Mb pdf, see page 32 and associated citations). Two other proposals for Cascadian LNG ports mentioned in CS05 are on the lower Columbia River. Three additional proposals, not mentioned in the book are at Humboldt Bay in northern California, at Kitimat in northern British Columbia, and at Cowichan on Vancouver Island. (Tip of the hat to Guy Dauncey for information on the latter two.)

Cascadia Scorecard 2005, III

One astute reader of the Cascadia Scorecard 2005poses a good question. The reader wonders:

what the “benefit” is of publishing maps that blatantly expose our energy vulnerabilities which Alan says are “virtually impossible to defend against determined attackers.”

I realize that you are trying to open our eyes to the tremendous need we have of weaning ourselves from fossil fuel dependencies, but do you really think that painting a “bulls-eye target” on our present-day energy resources is a sane solution, in today’s global terrorism society?

We thought about that, too. We thought about it a lot. Here’s why we did it:

Terrorists have long targeted energy systems in other parts of the world, with attacks on oil tankers and pipelines. They’ve specifically mentioned oil infrastructure as the “lifeline of the crusader community.” Cascadia Scorecard describes a threat that is largely unknown to northwesterners but is old hat to jihadists. So we’re definitely not giving them an idea they didn’t already have.

The Northwest’s energy vulnerability is a matter of public record. Anyone with a library card and an Internet connection has access to far more information about the region’s energy vulnerabilities than we described in Cascadia Scorecard. In fact, that’s all we used to do our research on energy vulnerabilities.

We were careful in preparing the report to tell readers only enough to understand the threat, not enough to misuse the information. Our maps, for example, are intentionally imprecise and schematic. They wouldn’t be much use to anyone with malicious intent.

What are your thoughts?

Fun With Math

In a recent post, I mentioned that the U.S. economy is highly energy-intensive. That is, the energy used to produce $1 of wealth in America can produce $2 in Germany and nearly $3 in Japan. So, all else being equal, high oil prices take a heavier toll on the U.S. economy than in more energy-efficient countries, simply because we need more energy to do business. (By the way, oil prices just bumped up past $50 a barrel.)

But there’s yet another reason why high oil prices hit harder in the States than elsewhere. On the global market, oil is priced in U.S. dollars. Obviously then, Americans feel every oscillation in prices because crude is denominated in the same currency as our paychecks. That’s not necessarily true in other countries.

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Has Spring Sprung?

This morning, Vancouver, BC will break its record for the sunniest February ever recorded there. And there are still nearly four days left, most of which are predicted to be sunny.

Meanwhile, next door in Washington, the Seattle Timesreports on the signs of spring, like hikers at Hurricane Ridge, emerging mountain wildflowers, blooming cherries and dogwoods, and Seattle temperatures setting records at 64 degrees Fahrenheit.

Free Ride

Gas prices have edged up over the past month, passing $2 a gallon in Seattle earlier this week as an east-coast cold snap pushed up crude oil prices.

But no matter how high the market price goes, gas (and driving in general) is still too cheap.

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To Health in a Handbasket

As the P-I (among others) reported last week, the Washington state budget is in trouble.  And one of the biggest problems for the state is the rapid rise in medical costs, many of which are borne by the state.

By now, it should be no surprise that health care costs are rising faster than inflation; but it may be a surprise how dramatic the change has been over time. 

Since 1980, inflation has grown at about 3.5 percent per year in the Seattle and Portland areas.  But medical expenses have grown by nearly 6 percent per year.  Year to year, that’s not a huge difference; but over time it really adds up, as the graph below shows.  On average, things are about 2.5 times as expensive now as they were in 1980; medical costs, however, are about 4 times what they were 25 years ago.

The big question in my mind is:  why?  Why, exactly, is the cost of medical care rising so much faster than everything else?

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Cascadia Scorecard 2005, II

There was a lot of media coverage of yesterday’s release of the 2005 Cascadia Scorecard (for example, this and this). What most interested me was that the media couldn’t find anyone who would directly contradict our finding that the Northwest’s energy system is virtually impossible to defend against determined attackers. We knew our analysis was alarming; we were braced to defend it vigorously. But there was no counterpunch.

The closest that anyone came to contradicting us were the quotes in this Associated Press story (here in the Salem Statesman-Journal). But the statements in this article do not actually contradict our analysis, they simply offer assurances to the public that the situation has improved since 2001. And that electric authorities are pretty good at responding quickly to emergencies. But that’s not saying much.

Now, the question is, will awareness of the energy system’s vulnerability to sabotage actually sink in and help to motivate more-rapid progress toward a resilient, clean, and prosperous energy future? One encouraging sign is this morning’s Seattle Post-Intelligencer’seditorial.

Regulation and Healthy Business

Is lax environmental regulation bad for the economy? Very likely, suggests an article in today’s Christian Science Monitor.

American businesses were once world leaders in wind power, solar panel manufacturing, and coal power plant pollution scrubbers. But decades of regulatory laxness has relegated alternative energy and pollution-reduction to the back burner. Now, in order to diversify its energy portfolio or reduce air pollution, the US is forced to play catch-up. And instead of boosting home-grown technology and business, Americans must rely on cutting-edge industries that have flourished in Europe and Japan. As the article explains:

"It’s not that our technologies were inferior, but we didn’t have the public policy or patience to build the industry," says the SEIA’s [Solar Energy Industry Association’s] Colin Murchie. While Europeans subsidized solar and wind production, the US offered tax breaks for fossil fuels and has allowed its wind-production tax credit to lapse repeatedly.

The next crossroads will be in greenhouse gas reductions. And again, US policymakers appear to have chosen poorly by not signing the Kyoto Treaty, a move that is intended to aid American industry, but could end up hurting the economy in the long run. Maintaining our economy’s singular reliance on fossil fuels is not a smart growth strategy for the 21st century. Global supplies of petroleum are waning and combating climate change (principally through reductions in fossil fuel combustion) will become ever-more important. So clean energy alternatives and energy efficiency will be critical in the coming decades.

And not only does the US economy rely too heavily on fossil fuels, it does not use its energy supplies efficiently. According to 2002 data from the US Department of Energy, with the amount of energy needed to produce a dollar of wealth in America, the British can make $1.50, the French can make $1.73, the Germans can make $2.01, and the Japanese can make $2.73. This "energy intensity" disparity puts the American economy at a big competitive disadvantage. The smart thing for long-term growth is not enabling the American economy to continue its wasteful ways, but using smart incentives and regulations to push for greater efficiency and resilience.

Cascadia Scorecard 2005

Today, we released Cascadia Scorecard 2005, which focuses on energy and, especially, energy security. Read it here.

Canada Plans "Free-bates"

This afternoon, Ottawa unveiled its budget. It’s got several line items of note, including $5 billion for cities through an agreement to hand over some of the proceeds of federal gasoline taxes. It’s also got $5 billion over five years for environmental programs, with an emphasis on complying with Kyoto. Creative components include a fund to help catalyze entrepreneurial greenhouse-gas reduction schemes.

To me, though, the most exciting announcement is an idea that was simply floated, not really included. Canada is still seriously considering adopting vehicle feebates, potentially one of the most powerful tax-shifts available. Word of this initiative came out last summer, as we noted at the time. But then everything went silent, and I got nervous. I needn’t have worried. Apparently, government leaders had simply stolen into their top-secret policy laboratories and were performing the delicate operation of inserting an "r" into this innovative reform’s name. Thus, not "feebates" but "freebates."

(I mock because I care. And I bet "freebates" will sell better than "feebates." Everyone wants something free; no one wants a fee. The tax shift itself remains unchanged: a fee charged to buyers of inefficient vehicles, a rebate paid the buyers of efficient vehicles. The size of the fees and rebates proportional to the efficiency of the vehicle. And the fees fully funding the rebates each year.)

The Globe and Mailreports

Within the budget, Ottawa also floated the notion of a vehicle "freebate" that would not only offer a rebate to consumers buying energy-efficient vehicles but also "impose a fee on fuel-inefficient vehicles."

"Over time, a freebate could contribute to the improvement of the fuel efficiency of vehicles purchased in Canada, reduced greenhouse gas emissions and improved air quality," Wednesday’s budget said.

The government, the budget said, is now negotiating with the auto industry to strike an agreement that would improve the fuel efficiency of vehicles sold in Canada. Ottawa is also asking the National Round Table on the Environment and the Economy to develop options on a so-called freebate. No timeframe was given on the idea, which Ottawa said would be "revenue neutral" for the government.

UPDATE 2/24: Well, I looked for details in the budget itself and—wouldn’t you know?–there’s no extra "r" there. It seems the venerable Globe and Mail added the consonant. The budget itself just says "feebate." Ah well.