Some of the second and third order effects I'm looking forward to from cheaper energy include a steady improvement to economic growth. Directly from the additional energy supply but also from the extra spending power released in developed countries from cheaper energy and the productivity boost in developing countries from abundant energy. Also the positive impact on price stability and exogenous oil price shocks to the economy. I think also less regional concentration of energy supply with reduced impacts on economic stability from conflicts in or with parts of the world with oil and gas.
I think we're more likely to get a long running benign economic situation as cheaper renewables come on line. Longer periods of steady economic growth with low inflation and low interest rates. That sounds good.
This in turn probably helps with political stability and solidarity and co-ordination. Fewer people under economic pressure, more resources to solve problems and more even distribution of productivity in the world. That all sounds politically beneficial. That's before considering that some of the countries that export cheap oil and gas in large volumes are unsympathetic to liberal social democracies.
There's still a lot of infrastructure to be built and some technical, but not technological, problems to be solved. Fortunately we're still at the point where we can absorb more renewables on to the grid and keep gaining from the learning curve effects and economies of scale without having to add huge amounts of storage. Certainly not all in one go. California being an exception to this. Batteries continue to show improvements in technical and economic performance. I think we've got at least 10 years before we reach the point where we can't install more renewables because we can't move or store the power - and over those ten years, more HVDC cables will be built, batteries and other storage technologies will mature and cheapen. I think we'll find that as renewable capacity increases that drives supply of storage and movement just in time.
I also think we'll see some significant deployment of geo-thermal electricity generation using directional drilling techniques from the North Sea and shale oil industries.
And lots more cables.
In addition to shorter cables like the Viking Link between the UK and Denmark
https://en.wikipedia.org/wiki/Viking_Link
There are a couple of interest long-distance cable projects which I'm following.
XLinks, which is a large solar PV, wind and battery park with a 3.6GW (that's nuclear power plant sized) cable from Morocco to the south coast of the UK. If it goes ahead completing sometime in the 2030's.
https://en.wikipedia.org/wiki/Xlinks_Morocco%E2%80%93UK_Power_Project
and the Sun Cable Australia Asia energy cable from Darwin to Singapore
https://en.wikipedia.org/wiki/Australia-Asia_Power_Link
Both at very early stages of development and neither without a history of set backs. Both projects become more feasible as solar PV costs come down.
There's lots of opportunity to achieve some arbitrage with longer cables
]]>I was under the impression that most of actual buildings in the Old Town were Victorian replacements of earlier buildings but on the same road layout and footprint.
]]>They can probably get to you if you are trading with anyone or in a jurisdiction which the EU can lean on.
That probably applies de jure to entities in the same group of companies and probably applies more strongly de facto.
So specifically in relation to Twitter they would have to cease all operations in the EU, probably up to and including not accepting advertising revenue from EU domiciled advertisers, USian group companies with EU trading arms or any USian company which also wished to trade in the EU. And this restriction might apply to Tesla depending on the structure of the ownership of Twitter.
Then you run in to the issues of warrants and covenants on the debt. As CEO of Twitter you are probably restricted in your ability to tank your EU businesses by deliberately or negligently breaking GDPR.
So fun times ahead there.
]]>And I think that is exactly the business model the company I'm thinking of appears to be following. They've got (so they say) some interesting nano-tubes for filtering feedstock out of dirty water and are electrolysing hydrocarbons out of that.
And it's some tech that would suit a place like Dubai which is trying to re-invent itself as a business, travel and tourism hub.
]]>I think you have enough of a round trip efficiency issue with converting solar energy in to hydrocarbons and then converting those hydrocarbons in to either movement or electricity that solar PV and wind will retain significant cost advantage in most cases. That said there are a couple of firms who have think they have a good enough method for converting electricity to jet fuel that they've signed some options contracts with a USian airline.
I think most of the PREE's, along with a few major producers of other fossil fuels, like Australia, have pretty good access to solar PV resources and be well positioned to earn a living exporting that solar PV electricty but I think their problem is that they don't have a monopoly on cheap renewable electricity in the same way they have a monopoly on cheap oil and gas. So they are a price taker in a falling market rather that a price setter. And I think they know this and are behaving as if it were true.
]]>Which is probably plenty to be going on with for Scotland and the world.
]]>You can't just declare internationally traded gas to be a lower price.
Not sure what the Labour Party do once they win the 2024 General Election and have to deal with more robust, larger, better resourced and potentially victorious trades union movement - given that the UK government has limited options to fix the underlying economic problems the country faces in the short-term. Even if they started a national programme of onshore wind turbines and insulation that's still 3 years away from having a meaningful impact on energy prices.
And the country feels in a truculent mood after two or three years of Covid and the behaviour of Boris Johnson. I'm not sure they (we) are in the mood for another round of patient endurance.
So I can see real potential for large scale civil disobedience and violent protest - probably next summer (especially if hot) once the impact of energy prices and food prices has had another 9 months to impact people.
]]>So they do invest in renewables.
]]>I think fossil fuels are dead long before anyone puts huge solar panels in orbit. Infrastructure projects take a long, long time to happen. The energy industry plans in decades. Fossil fuels are mortally wounded, they just haven't died yet.
Earth based renewable energy systems will be cheaper and as reliable as fossil fuel systems by about 2030 without policy support.
Solar PV in good locations is already cheaper than Combined Cycle Gas Turbines. The learning curve effect for solar PV looks to be 15% or more. Deployment will probably double and double again over the next decade. Solar PV will be about 1/3rd cheaper in 2030 than it is today. There is more than enough land in the world that is not much use for anything other than a solar PV array to power the entire planet several times over.
Onshore wind is reasonably competitive on cost with fossil fuels. Learning curve effect is lower and there is a longer history of deployment but long-term cost reductions of 2% a year for the next decade are probably reasonable. Onshore wind in 2030 will cost about 85% of today's cost.
Offshore wind will see it's costs fall faster. That includes offshore wind in deeper waters built without towers. Most people live near the sea.
And those costs keep falling.
The costs of storage are falling. Part of the current problem with battery storage is that most of our batteries are designed for applications like mobile phones and laptops or cars. They are a bit sub-optimal for storing power for overnight, or till the weekend or for a few months. Other storage technologies are still being used in a fossil fuel network. For example existing hydro dams which provide peak power during the day can be repurposed to provide power in the winter just by operating them in a different commercial model.
More importantly cabling is getting cheaper and supply of cabling and cables is improving. Losses from High Voltage DC cables are a couple of percent per 1,000 kilometers. There is for example already some tentative plans to build a solar PV array in northern Australia and cable the power to Singapore. (One of the problems with the deal is that the Singaporeans appear not to trust other people with their energy supply are hesitant to rely too much on a big cable they don't control.)
The availability of interconnection means you can move solar PV generation from North Africa and Arabia to Europe and Southern Africa, from Australia to SE Asia, Texas, Arizona and New Mexico to New York - and do the same for onshore wind from the US wind belt.
You can foresee a grid in Western Europe that links offshore wind farms in the North Sea and Atlantic with hydro resources in Norway and also south towards solar PV resources in Morocco which doesn't require much in the way of long-term battery storage. Parts of that are already being built.
The technology to do all of this cheaper than current energy prices already exists, it will just take some decades to actually build it.
So I'm not sure what Elon Musk is up to. Perhaps he is mistaken about the deployment trajectory of Earth based renewables (or perhaps I am). Perhaps his interest in energy infrastructure in space is to move the demand centres in to orbit too for some asteroid mining. Perhaps he is trying something else. Perhaps he just wants to build a muckle great rocket ship.
]]>1) Johnson stands down voluntarily in January, citing mission accomplished on Brexit but the long-term impacts of Covid. He goes off to cash in writing newspaper columns and give lectures.
2) Johnson is informally forced to stand down following the May elections in Scotland and London and the English local elections.
3) Johnson is formally forced to stand down following a vote of no confidence by the Conservative Parliamentary Party in him as Conservative Leader. This following a period of difficulty for the government following a difficult Brexit, difficult May election results and a difficult COVID situation and Johnson failing to get a grip of them over the summer.
None of those lead to a General Election in the UK and the new Conservative PM inherits an 80-seat majority.
]]>Widespread calorie shortages are a bit of a game changer for a government and can rapidly spiral out of control. This is probably especially true if you are politically required to not plan or publicly prepare for calorie shortages because you have promised people things will be better not worse after 1st January.
I'll be interested to see if the food shortage situation is different in different parts of the UK. Specifically I'll be taking a close interest in Scotland. Scotland is a bit different from the rest of the UK. I think it produces more food per capita than England. It definitely has more of its population near a large port on the eastern coast and several of those ports are conveniently close to a petrol refinery. That might turn out to be important.
I think the UK is going to experience a bit of psychological blow in May when the Scottish elections happen. Unless there is a significant change in mood in Scotland in the next 4 or 5 months the SNP will win a majority of seats at Holyrood, probably with an absolute majority of the vote. The Scottish Green Party, also pro-independence will likely pick up between 5-10 seats in addition. And by May we'll have not 14 consecutive pro-indy polls but likely 40. I think at that point it might finally dawn on England and the government of England that the population of Scotland is settled on having a second referendum and probably settled on leaving the UK. I'm not sure that England really believes we would actually do that yet. What they do with this realisation I don't know. I'm not expecting that their response will that effective in the long-run. There is only so long you can tell people that their democratic and peaceful desire for a change is forbidden.
I would not be surprised if Spain actually annexes (de facto) Gibraltar in the next 5 or 10 years. At some point a Spanish government is going to find itself in domestic political difficulty and asserting their claim over Gibraltar is going to be a tempting way to divert attention from the issue of the day. The question for me is whether the Gibraltans value being British over being able to live comfortably in Gibraltar. If that happens the UK is going to find itself very isolated.
The EU is going to have to have a careful think about how it deals with separatist regions in the EU. My assumptions are that the EU and most EU countries would welcome an independent Scotland joining the EU and would do so for three reasons 1) the EU likes enlargement 2) Scotland is a pretty good candidate nation being already highly converged, pretty prosperous, already a European-style social democracy and 3) a nice opportunity to demonstrate to people that if you leave the EU bad things happen to you such as, your country splits and you lose 8% of your population and a third of your land. It would be helpful to the cause of Scottish independence and therefore Scottish accension to the EU if the EU could demonstrate support for Scottish accension and a clear and quick path to membership. That's tricky to do whilst Spain is still wrestling with Catalonia. I'm not sure that the EU has a clearly worked out plan here.
]]>I think two very important factors that will influence whether the world turns out to be an okay place to live or not are
1) economic development in Africa
2) the quality of democracy in South America.
The biggest factors are the twin issues of climate change and trying to accomdate 10 billion people on the planet.
Then, looking at the particular criteria and wanting to avoid being murdered by a hangry mob I have a three-strand plan.
Plan X - Africa & South America
Use the income from the fund to "invest" in African infrastructure projects. There is good money to be made capitalising Africa and the quicker Africa has better infrastructure the better for Africa and the better for everyone else.
I would invest in the form of Not-For-Profit Institute or charity. The Institute would own the investments in Africa ports, airports, railways, power-stations etc. Part of the requirements for investing in the projects would be good labour relations and the provision of health care and education to the families of the workers. Compulsory but free vaccination for everyone in the family of anyone who works in the supply chain for example.
Profits would be spent on rounding out health care and education in Africa and funding campaigns in South America towards building democratic participation, strong democratic institutions and deliberative and participative democracy.
I would intend to control the Institute with a succession plan of handing control over to a more democratic structure (not tied to the governments of nation-states) after my peaceful death. (If I meet a violent death then the Institute spends a generation being run by a close relative with more of a focus on justice / revenge.)
Plan Y - Plan Y Prizes
I would very loudly and very publically offer large prizes in the form of an X-Prizes for "solving" a number of problems that impact on climate change directly or which impact on the mitigation or accomodation strategies for dealing with climate change and lots of people. The aim would be find technologies that made the provision of Y benefit in a sustainable way signifcantly cheaper than the current way of doing it.
Examples include
vat-grown meat (to reduce the environmental damage of animal husbandry and deforestation)
palm oil substitute from aqua-culture or desert based hydroponics
automated deep water aqua-culture
hydroponics or aeroponics
I'd probably steer clear of things like reducing the cost of wind turbines, reducing the cost of solar PV, energy storage, vechicle autonomy as I think transformative breakthroughs in those areas are already in the procss of being worked on.
What I would hope to achieve is a) increased R&D effort pointed at these problems and b) a clear signal to the current incumbents (including their host governments) that the game is up. I'd hope that Brazil and Indonesia would look at their future deforestation plans, realise that there will be no market for beef or palm oil soon and shift focus.
Plan Z - Host Country - Shifting from Parasite to Symbyotic Relationship
I'd pick a small country who I think has a progressive ethos and then spend some of the fund income boltering them for the coming difficulties in a way that lets me put my name on a lot of things.
Scotland looks like a decent bet - given that I'm already here.
So investments in research institutes at universities, focused on technology to mitigate climate change and lots of people, with lots of scholorships for kids from poor or disadvantaged backgrounds, libraries in primary schools, pavilions in community grassroots sports clubs, refuges for people in abusive relationships, drug rehabilitation centres, museums, heritage sites and art galleries in small towns, skills programmes for disadvantaged older people.
I'd be looking for four outcomes, 1 - things that position Scotland to have the right technology to keep economically wealthy during the climate and population transition, 2) things that bring people together, and build community cohesion and 3) things that reduce the gap between rich and poor , 4) something that makes it more likely that Scotland would be willing and able to accept climate change refugees.
All with my name on them.
I'd be hoping that that makes Scotland more likely to not be destabilised by climate change and population crises and also buy me enough good will that I'm not a target for mob violence.
I would, of course, build a secret super-villan lair in the north west of Australia for me and few thousand of my closest friends but that is only for if things go really badly wrong.
]]>I tend to view that BitCoin is a Ponzi scheme.
However, if it turns out to be successful as a currency, I mean generally used as a means of exchange for a significant portion of world trade then things get a interesting. I think the first effect is deflationary; a transfer of wealth to those holding BitCoin from those holding other assets (including their own labour). Then I think followed by a period of inflation as everyone tries to set up their own BitCoin. Which is akin to forgery or perhaps seigniorage.
Which makes me wonder why you would use BitCoin or similar as a means of exchange when it doesn't have a practical monopoly on being the means of exchange in a geographically defined area with unified regulatory bodies who have a monopoly of sanctioned violence.
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