With all the talk recently of EV’s being tested in various countries and three models (Subaru R1e, Mitsubishi iMIEV, Nissan Denki Cube) potentially arriving in the US in just a few years, it’s worth revisiting once more the notion of how well such a product would be received here.
My longtime position has been that if you make even minimally reasonable assumptions about the vehicles–they’re safe, they’re as efficient as one would expect a small, all-electric vehicle to be, they’re affordable, and they don’t have any weird “gotcha” details–they’ll find millions of happy owners.
My reasons:
I’m not predicting that EV’s will instantly be a universal replacement for vehicles with internal combustion engines. Some people won’t like EV’s for whatever perverse reason, some really do need larger vehicles with special capabilities, some don’t have a handy way to recharge them overnight (as in their own garage), and there’s the most obvious problem, a battery range that’s far less than the even a single fill up range for a gasoline powered car of the same size.
So far, even restricting EV’s for commuting use sounds pretty revolutionary: Millions of drivers piling up billions of short-trip miles without a drop of gasoline being consumed, and considerable savings in CO2 emissions.
This was exactly the line of thought that led me to the conclusion that the real EV revolution is in the second plug.
Nearly all discussions of EV’s assume the same basic operating model: You plug it in overnight to slowly recharge the battery, and in the morning you drive off. If you’re lucky, you can plug in during the day (note to hotels, airports and parking garages: here be profit potential), but most people will return home on that same charge from the previous night. The critical detail is that it takes hours. not minutes, to recharge a battery that’s even half discharged.
But what if your EV had two plugs? One that connected to a normal 110-volt socket in your garage, and one that could handle a much larger current and give your battery, say, an 80% recharge in 15 minutes? Would you be willing to stop at a filling station for a 15 minute recharge and cup of coffee every 100 miles (instead of a 5 minute gasoline fill up every 300 miles) if it meant you could save 10 to 15 cents per mile in fuel costs? And remember, you could still top off your battery at home overnight, so you would only have to resort to the filling station for longer trips.
This isn’t just speculation, as there’s been a lot of talk about quick charging car batteries, with that “80% in 15 minutes” capability seeming to emerge as “the” target, and I’m sure that the engineers working on driving down the cost of battery packs are also spending time finding ways to make them withstand the considerable stress of such high-current recharge cycles. This could, in fact, be the perfect market opening for ultracapacitors, which should be able to take on a full charge much easier than a true battery. But for the purpose of this post I don’t care what’s inside the “battery pack” as long as it safely and efficiently stores and then delivers electrons.
Once such dual-plug EV’s hit the road, how long do you think it would take before filling stations started adding quick-charge capability? This infrastructure build out would take time before charging stations were available “everywhere”, but that limitation would be buffered by the potential, mentioned above, for people to buy or rent battery pack upgrades for special circumstances.
At that point, how quickly would you and most people you know ditch your gasoline cars completely, knowing that you would pay much less for fuel, pollute less, contribute less to your country’s trade deficit, and no longer care what the price of oil is doing in response to events halfway around the world?
If that’s not the beginning of a complete revolution in personal transportation, I don’t know what is.
There’s been a sizable number of new visitors to this site recently, thanks to the huge number of hits one recent post received, so let me say a word or three to the newest members of the community:
See U.S. car companies go back to black for an explanation of how the Big Three are (finally) simplifying their product lines.
For decades I’ve been convinced that the US car companies have been shooting themselves in the foot with the way they present the buyer with an avalanche of options. Everything from basic platforms, like whether a minivan had a seven- or eight-foot cargo area (e.g. the most notable difference between Dodge’s Caravan and Grand Caravan variants for years) to endless “convenience” options, which now include not just a DVD player but dual DVD players in the current generation Caravan. Their solution was not to simplify the offerings but to bundle them into things like the “safety group option” and the “convenience (there’s that word again) group option”, etc. As a result, they often had would-be customers who, for example, wanted a sun roof being told they had to get the upgraded stereo and leather seats in order to get the “package” with the sun roof.
I know how they got into this mess, of course: The desire to come up with the lowest possible base (pre-option) sticker price coupled with an obsession over trying to build the perfect set of features for every single customer who walked into a showroom, no matter the dollar cost in complexity or (ironically) the customer dissatisfaction all that complexity triggered by making the ordering process akin to taking your SAT’s while stoned.
My car, a 2006 Scion xA, is an excellent example of just how far companies can go in streamlining models. I had a limited choice of colors (six, I think), including the ones almost everyone would want (I got a blue one), no choice on interior color (Henry Ford black was it), and no choice on air conditioning (it came with it, period, which was fine with me and my horrendous allergies), and two choices of transmission (5-speed manual or automatic). You did get to pick the wheel covers from four or five options–which were stocked and installed by the dealer, as was the sound system. The price of the car included a very respectable AM/FM/CD head with an MP3 jack, but the car arrived from the factory with no stereo head installed at all–the dealer popped in either the standard or upgraded unit as part of the car prep.
Instead of fancy electronic heating controls, the ones in my xA are (gasp!) manual. Really. And I use them all the time with (so far), no ill side effects from having to turn a knob to set the heat or slide a lever to switch from recirculated to fresh air. Will techno-wonders never cease.
To be clear, you can buy all manner of car bling and minor add-on goodies at the dealer, like fancy shifter knobs, sport pedals, and overhead storage boxes. And I notice that the list of such items has grown considerably since I bought my car in June of 2006, so perhaps Scion/Toyota and the US car companies are meeting in the middle?
I’m convinced that this trend to simplify vehicle options will only help consumers and the US car companies. I talk a lot about the low hanging energy efficiency fruit, and the decidedly weird way in which the US car companies still build their vehicles and present them to the public is another example of potential gains just waiting to be plucked. It’s just a shame that they had to get into so much financial trouble before they pulled their heads out of the sand.
I’ve opened a topic over on the discussion board to talk about whether peak oil is actually a good thing because of how it will restrain our carbon emissions.
Please come over, register if you need to (it’s free and painless, really), and join the discussion.
The topic is: Peak oil vs. global warming
There are certain jobs in this world that even in my most Walter Mitty-ish moments of grand self-delusion I would not want and would not accept. Right now running one of the Big Three US car companies is pretty near the top of that list, probably second only to being US president for the next four years.
The Big Three are all facing the same basic issue: Thanks to the rising price of gasoline, the subprime mortgage blowout, and the all-but-official recession, the rules of the game have not only changed and in a particularly inconvenient way, but they’ve changed far faster than anyone at those companies anticipated.
Yes, you can make the argument, as I have numerous times, that they set themselves up for this debacle. They shunned hybrids and they exhibited the absolute worst of the short-term mind set that we all beat up many US companies for. In this case, they willingly embraced an absurd reliance on light trucks (pickups, SUV’s, and minivans), because of their higher profit margins. Now that circumstances–some foreseeable, some not–have made the competitive landscape lurch in a way that strongly favors less expensive and far more fuel efficient vehicles, they were caught with all their weight (and product mix) on the wrong foot. But rather than dwell on that series of miscalculations, let me focus on what comes next.
I’m sure that by now the top brass at the Big Three have gotten the message–less oil consumed and less CO2 emitted per mile will be the two guiding principles for their business for the next several decades. Peak oil and global warming are not going away, and they will have numerous, overlapping, and major influences on the life of everyone on this planet for a very long time.
The question, of course, is how do you, Mr. Car Exec, get your company to that post-oil, cleaner future intact?
“Wait!”, I imagine many of you yelling, “Aren’t you the guy who’s always telling us about all the things we can do save a lot of gasoline right now? And don’t you prattle on endlessly about the coming wave of electrification of personal transportation?” Yes, I am, and thank you for paying attention. The issue at hand is largely not the technology, but keeping the companies alive while they make that transition.
We have a huge and terrifying conceptual gap hanging over the peak oil situation. Oil industry experts and the IEA are talking openly about there being an “oil crunch” around 2012, and I’ve heard from several people with high level contacts that the operating assumption in many large corporations and other organizations is that we’re headed for a 2011/2012 oil peak. But who among the non-experts you live and work and associate with know what’s coming? How many of them think that our current “high” oil prices are nothing more than another “spike” that will subside and we’ll all be tooling around on $2/gallon gasoline again? Further, how many are absolutely convinced, right down to their DNA, that the current prices are nothing more than “the oil companies screwing us again”, and that things will be fine once we get those two oil men out of the White House next January? I’ve heard one variation or another of that view from more people than I can count.
Our politicians are utterly useless on this front, of course. They talk about global warming (good) and “achieving energy independence” (completely bogus), with only a vanishingly small percentage of them daring to let the dreaded phrase “peak oil” cross their lips.
It’s easy to see why the pols and the pundits and the CEO’s don’t talk about this more openly–it’s big and very scary and they don’t want to tank the economy far worse than our current situation. Imagine if Bush gave a speech in which he said that peak oil was coming in just four years, less than the average time a household owns a new car. What would you see? High MPG cars (new and used) would instantly be selling at a huge premium, low MPG vehicles would tank in resale value and would be almost impossible to move off the showroom floor. But the knee-jerk reaction wouldn’t end there, and we’d see the jolt to the economy and the mind set of consumers go much further. Rich people would install gasoline tanks on their property and try to hoard gasoline or heating oil, people would rush to take overseas trips while they could still fly, sales of guns would be off the charts, and the purchasing patterns for nearly all durable goods would be warped almost beyond recognition. One can barely imagine the reaction in some parts of the Internet.
But that Grand Revelation won’t happen, of course. Instead, we’ll continue to ease up the oil production curve to the peak like passengers on a roller coaster climbing that first big hill, and many of us will continue to buy trucks. As a result, we’ll have an enormous number of brand new trucks infesting the fleet of US vehicles on the day peak oil arrives, a large portion of them discretionary purchases, meaning they were not bought out of business or other genuine need but purely as part of the truck fad that has yet to burn itself out in the US.
As gasoline prices continue to rise, the resale value of those F-150, RAMs, and Silverados, plus the dozens of SUV models and (to a lesser extent) minivans, will decline, and if there is a tipping point in the mainstream awareness of peak oil, those prices could plummet. Even so, once we’re beyond the peak and gasoline prices get exceedingly interesting, we’ll still be stuck with those millions of trucks on the road that were sold since 2000. That needless inefficiency amounts to an enormous, worldwide truck tax (oil being a fungible commodity) that we’ll all pay for, whether directly or indirectly, via higher prices for gasoline and fuel efficient vehicles as people bail out of trucks they can no longer afford to drive.
So, for the good of the country as well as themselves, the Big Three should shift their development and production heavily toward smaller, more fuel efficient vehicles, right? That’s the problem: Through their endless advertising they’ve helped create that warped, myopic mind set among consumers, the one that says everything will go back to “normal”, the oil companies are “screwing us”, etc. Consumers don’t know what’s coming, they don’t want to know, and the car companies were delighted to keep selling them the truck myth.
As a result, the Big Three have to keep selling those high profit margin trucks and ridiculous things like the Mustang and the reborn Camaro to stay afloat even as they scramble to develop the Volt and promote E85-compatible vehicles (more for PR value than anything else until cellulosic technology goes mainstream).
And while this is far from a perfect solution, it’s likely the best one available, a classic example of the optimal path not being a particularly good one. We need as many car companies as possible working on these problems, including the Big Three. It’s not in anyone’s best interest to see any of them disappear, not theirs, not their employees’, not their suppliers’, not even their competition’s.
The price the US consumers will pay for their willful (and assisted) ignorance, and to keep the Big Three from becoming the Big Two or even the Big One, will be painfully high, but that’s the path we’re locked onto.
Unless, of course, enough people wake up and start to take action now, before we hit the peak and those much higher oil prices arrive. We may have long ago squandered our opportunity to make a comfortable transition away from our oil dependence, but we still can greatly soften the blow.
NASA has some photos up of the Wilkins ice sheet collapse here. The page includes a map of Antarctica colored to show which parts have warmed and which cooled from 1981 to 2007. The deniers won’t like it.
Administrative update: I’m now settling into a pattern of using the blog for longer, single-topic posts, like the one I wrote this morning on CCS, and the discussion board for more newsy things. I’m posting this Wilkins piece in both places because it’s a major event.
Also, I started a topic over on the board where you can recommend your favorite energy and environmental books. Feel free to stop over and tell us all what we all should be reading.
CCS (carbon capture and sequestration) is an increasingly hot topic in the energy and environment realm, and with good reason. The numbers (from the Dept. of Energy’s latest Annual Energy Review) behind our situation here in the US are as grim as they are indisputable:
Notice the interplay of numbers above–even if we could somehow, magically, eliminate 100% of our CO2 emissions from residential, commercial, and industrial energy consumption, plus that from transportation and all non-coal electricity generation, and we put in place a 100% moratorium on non-CCS coal plants, we’d still be stuck at a reduction of “only” 67% of today’s CO2 emissions.
In other words: We have to rely on a combination of retrofitting CCS onto existing plants (which were never designed or sited with such a scheme in mind) and replacing them much cleaner alternatives.
Replacing a significant portion of those plants will be extremely expensive, to say the least, so it looks like CCS is a major part of the solution–or is it? As the Worldwatch Institute points out, U.S. Environmental Groups Divided on “Clean Coal”:
Groups like the Natural Resources Defense Council (NRDC) and Environmental Defense Fund are already lobbying on behalf of CCS. Others, such as the Sierra Club and the World Wildlife Fund, are more cautious about promoting CCS. They insist that affordable and proven technologies, such as energy efficiency and wind or solar energy, should be more fully implemented before CCS is considered. Greenpeace specifically opposes the technology.
A divided environmental community is reflective of a still unproven technology. Although CCS is almost certainly technically feasible, both the timing and the cost are highly uncertain. A Massachusetts Institute of Technology report released last year, The Future of Coal, concluded that the U.S. CCS program is not on track to achieve large-scale commercial operation for at least a decade.
Carbon liability concerns have led major investors and the U.S. government to rein in financing for coal-fired power plants. As a result, the coal industry has embraced CCS as essential to its survival. Some environmentalists say CCS is critical to creating a political deal that would dissuade power companies from blocking new climate legislation. “Congress should require planned new coal plants in the United States to employ CCS without further delay,” NRDC said in a statement last year.
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“We need to make sure that the technology to capture and store carbon is feasible and in place,” said Bruce Nilles, The Sierra Club’s national coal campaign director. “While we are evaluating the role coal should play in our energy future, we should continue to move forward with the clean, affordable energy solutions that are available today, like wind and solar power.”Greenpeace has taken a hard-line approach against CCS. “We are opposed to CCS technology,” said Kate Smolski, Greenpeace USA global warming campaigner. “The No. 1 reason is it’s a way the dirty polluting coal industry can prop itself up. It’s an unproven technology. And it takes resources away from solutions that we can use right now.”
The main concern with CCS is whether carbon stored inside empty aquifers would leak and pollute groundwater reserves. “If people think this is the solution, think again. A lot of research is needed,” said Steven Chu, director of the Lawrence Berkeley National Laboratory at last week’s “Summit on America’s Energy Future,” sponsored by the National Academies of Sciences and Engineering.
Any more bickering, and one would think these people are Democrats running for president. But I digress.
I’ve made no secret of my deep skepticism of CCS technology as anything more than a very localized, small scale (relative to the overall problem) solution. We can’t even figure out how to store and manage solid nuclear waste after years of trying, and now we want to take on storing billions of tons of CO2 gas underground every year, and then monitoring it and remaining prepared to plug leaks(!?) permanently?
At what point do we admit that attempting to use CCS technology to bail us out of part of this colossal mess we’ve created is nothing more than another ludicrous geoengineering boondoggle? When do we recognize that we sold ourselves a bill of goods, and now the real bill is coming due?
There’s an old observation that there are three kinds of “free”: Free as in speech (unencumbered by law), free as in beer (zero monetary cost) and free as in lunch (the most expensive form of self-delusion). Until now, we’ve treated all those CO2 emissions as a free lunch. No one paid for them and no one was asked to, so there was no economic back-pressure from a pricing mechanism to restrain our building of coal plants and motor vehicles that collectively emit such mind blowing amounts of that particularly long-lived greenhouse gas.
But philosophy and hand wringing aside, what do we do? We live in the real world with those 1,500 coal-fired plants cranking out not just electrons but CO2 and mercury and other pollutants, plus who knows how many more being built in China and other countries every week, and hundreds of millions of vehicles being driven billions of miles per day.
The situation is so desperate that we can’t afford to turn our back on CCS as a potential, albeit small, portion of the overall solution. We need an effective, tough, cap and trade system, plus various technology- and application-specific incentives (e.g. a feebate system to get people to buy much more fuel efficient vehicles, a long-term renewal of the production tax credits for solar and wind power, etc.), likely funded in part from the CO2 permit auction proceeds. And we need to find out, as quickly as possible, if we can make CCS work on a widespread basis and under what conditions and at what costs.
What a mess. Our future is rife with potential for disaster; through ignorance and greed we’ve put ourselves into a truly nasty situation and the only way out requires us to be efficient and smart and just a little bit lucky. Such is the price of a free lunch.
It seems a really large chunk of ice has broken off of Antarctica, and the news is just making the rounds.
Vast Antarctic Ice Shelf on Verge of Collapse:
A vast ice shelf hanging on by a thin strip looks to be the next chunk to break off from the Antarctic Peninsula, the latest sign of global warming’s impact on Earth’s southernmost continent.
Scientists are shocked by the rapid change of events.
Glaciologist Ted Scambos of the University of Colorado was monitoring satellite images of the Wilkins Ice Shelf and spotted a huge iceberg measuring 25 miles by 1.5 miles (41 kilometers by 2.5 kilometers - about 10 times the area of Manhattan) that appeared to have broken away from the shelf.
Scambos alerted colleagues at the British Antarctic Survey (BAS) that it looked like the entire ice shelf - about 6,180 square miles (16,000 square kilometers - about the size of Northern Ireland)- was at risk of collapsing.
David Vaughan of the BAS had predicted in 1993 that the northern part of the Wilkins Ice Shelf was likely to be lost within 30 years if warming on the Peninsula continued at the same rate.
“Wilkins is the largest ice shelf on the Antarctic Peninsula yet to be threatened,” he said. “I didn’t expect to see things happen this quickly. The ice shelf is hanging by a thread - we’ll know in the next few days and weeks what its fate will be.”
Also, Huge Antarctic ice chunk collapses:
A chunk of Antarctic ice about seven times the size of Manhattan suddenly collapsed, putting an even greater portion of glacial ice at risk, scientists said Tuesday.
Satellite images show the runaway disintegration of a 160-square-mile chunk in western Antarctica, which started Feb. 28. It was the edge of the Wilkins ice shelf and has been there for hundreds, maybe 1,500 years.
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Such occurrences are “more indicative of a tipping point or trigger in the climate system,” said Sarah Das, a scientist at the Woods Hole Oceanographic Institute.
For yet more detail, see also:
Wilkins Ice Shelf (small photos)
Antarctica’s Wilkins Ice Shelf Risks Collapse, U.K. Group Says
Antarctic Ice Shelf Collapse Tied to Global Warming
Antarctic ice shelf disintegrating as result of climate change, say scientists
Vast Antarctic ice shelf on verge of collapse
Huge Iceberg Breaks Away, Antarctic Ice Shelf ‘Hangs By A Thread’
Most people visiting this site have seen the graph. The summer ice cover in the Arctic declines, reaching an all-time low in 2005, then rebounds just slightly in 2006, only to take a vertigo-inducing plummet in 2007 that obliterates the 2005 record. (If you’re new around these parts, see Figure 3 on this page for the graph in question.)
On top of these recent records we have warnings about how thin the Arctic ice is, as one would expect coming off that 2007 summer record melt, and how we could easily blow past that record in 2008.
Which begs the question: When will we have a summer in which it all melts, and the entire top of the planet is blue water?
As it turns out, at least a few scientists are saying it could happen in five years–unless they were being too conservative (an ironic twist to the term that anyone familiar with US politics should find, well, twisted). And one scientist said it five years ago.
That scientist, Dr. Wieslaw Maslowski, was interviewed by the group Beyond Zero Emissions, and you can read the interview or download a podcast here.
The interview includes this exchange (emphasis added via italics, the bolding is in the original):
Matthew Wright: Ok. So now, it was reported in The New York Times that you said that 2013 was a possibility and perhaps you’d actually projected this some years ago, that we could lose the summer sea ice extent - that’s in the summer solstice is it?
Dr Wieslaw Maslowski: That is correct. So the minimum in the Arctic ice extent has been typically occurring some time in September, between early September and late September every summer. So, the minimum of ice extent is simply defined as the ice edge of percentage roughly say between 15, maybe at 20% ice cover. And then everything inside this ice edge position on the Atlantic side and on the Pacific side is considered to be the ice extent so it’s not really concentration - it’s just the area within the 15% or 20% ice concentration or more. And this ice minimum has been declining quite significantly. The global climate models have predicted ? your audience is probably familiar with this International Panel for Climate Change study, the annual report IV that has been published and presented quite extensively this year, earlier this year in 2007. And actually the panel together with ‘president’ Al Gore have won the Nobel Prize nomination. So those studies from this panel, the multi-national climate simulation study have predicted the ice might be disappearing in summer, the northern summer in the Arctic, maybe sometime by the end of this 21st century.
There are some model simulations, single model simulations, that are suggesting that it could possibly occur as early as 2050 or maybe even as early as 2030. Comparing those models simulations predictions with the satellite observations of the Artic sea ice extent actually shows that most of those models are too conservative predicting the current and the past ice extent changes in the Arctic as has been observed. So the idea is that the climate models - they’re underestimating, they are too conservative in their prediction. What our contribution, our study contribution to this overall topic is that we’re saying that the satellite are only observing the 2-dimensional changes in the sea ice in the Arctic in terms of this ice extent. However we do not have the observations of ice thickness - the third dimension, the vertical dimension - are very limited of the Arctic sea ice. And having those models that we used, we are able to look at the changes associated, not only with the ice extent but also ice thickness and this way we can eventually calculate and try to understand the changes in the total ice volume in the Arctic. And our studies are suggesting that actually the volume and the thickness is decreasing even faster than the aerial observations from satellites. And this way we’re saying that actually if we already have lost probably about 40% volume in the Arctic so far, if we project this trend ongoing for the last 10 - 15 years, we probably will reach zero in summer some time ? mid next decade, I’m sorry.
Matthew Wright: So there’s been other projections from some glaciologists; around 2020. So somewhere in that range. You said 2013 in The New York Times where it was reported, that something between then and 2020 is very like, very in the ballpark and a likelihood.
Dr Wieslaw Maslowski: It’s interesting that the longer we wait and the more we see what is happening, what changes are happening in the Arctic, the sooner people start predicting those changes will completely melt ice in summer in the Arctic - as soon as in the next decade or so.
How utterly depressing and unsurprising. We are faced, yet again, with this dreadful combination of our own ignorance (despite the best efforts of the best climate scientists on the planet) of exactly what we’re doing to the environment with our energy consumption, and our apparent insistence on not making significant changes. We continue to insist on more studies before leaping into action because just enough of us are just too scared or too ideologically incapable of taking the needed steps. Little by little, day by day, year by year, the delayers and deniers win, while the costs of the inevitable responses rise and nature and all of humanity loses.
I know it’s a distinctly unpleasant image, and I sincerely apologize in advance for whatever discomfort it causes any of you, but until someone hands me a better analogy I will continue to say it: We insist on playing Russian roulette, even as the evidence mounts ever higher that there’s more than one bullet in the gun.
If you get a chance, please visit the new TCOE Bulletin Board. There’s a new poll up, Are reviews of bad books a good idea?, and you can start your own discussion topics on anything related to energy and the environment.
One of my ongoing frustrations with energy and environmental issues is the dreadful quality of the treatment of them by the mass media. Between the mindless hyping of hydrogen fuel cell vehicles and clean coal, to a refusal to talk about global warming beyond the “it’s bad we need to emit less CO2″, I spend more time yelling at my TV, computer screen, or radio than I care to admit.
There are some exceptions, particularly in the business press, where people who actually understand what “peak oil” means often get a fair hearing. I don’t even mind (at least not too much) the way those media outlets almost universally resort to the “faux balance” tactic of having someone on at the same time who tells us not to worry, be happy, and vote for more tax breaks for the oil companies. Keeps the debate going, and hey, it’s good for ratings, which is the only thing the large media companies care about.
This simmering annoyance with the media is why I feel an obligation to point out those mainstream treatments that seem to be at least reasonably enlightened, even when they dance right up to the truth and then trip over their own feet. A case in point comes from our friends in Canada at the Globe and Mail, in the article, Reserves don’t matter as much as the cost of getting the oil out the ground:
Reserves on their own don’t matter. What matters is the cost of getting the reserves. Shell’s investment per barrel of oil and gas has increased fourfold in just three years, a period during which the oil multinational’s output has not increased. The company displayed another chart showing the average spending of the big oil companies. Per barrel of hydrocarbons, spending rates were pretty static during the 1990s at between $5 (U.S.) and $6 a barrel. In 2003, the rate of investment began to escalate and is now shooting higher, rising at an alarming pace. Last year, the average investment per barrel was just shy of $15.
On top of that, you must load the daily cost of operating wells and pipelines and the colossal overhead of running a big oil company. Moreover, we know that the $14-to-$15-a-barrel average investment is just an average and it is rising. Every new barrel is a more expensive barrel because in order to get the oil, Western oil companies must push the technology envelope even further, into deeper water and more heavy oil, such as Alberta’s oil sands. The only giant discovery of the past decade has been Tupi, the eight-billion-barrel oil field discovered offshore of Brazil in water depths of two kilometres.
Technology is expensive, but it is the materials, manpower and energy cost that hurts. Shell estimates that the operating cost per barrel of the Athabasca project is between $20 and $25, of which a third is energy - the cost of natural gas used to heat water to extract bitumen from sand. Shell won’t reveal the capital cost of an Alberta oil sands barrel, but it is certainly a lot higher than its average of $7 and likely near the top rate of $15 to $20.
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That [a bust cycle] can happen only if the West’s big oil companies repeat their achievements of the 1970s and 1980s with a series of exploration successes, such as Brent and Forties in the North Sea and Prudhoe Bay. The worry is that today’s spending is not delivering many more barrels, just more expensive barrels. The cheap barrels are out of reach in Iraq, Iran and Russia. It’s not peak oil we have to worry about but oil inflation.
They got it right through about 90% of the article, only to veer into the nearest ditch at 100MPH in the last paragraph.
I will never understand why so many people have such a hard time getting that the “oil inflation” we’re experienced over the last several years is the beginning of peak oil’s impact. It’s not two completely distinct phenomena, but different stages of the same process. It’s directly analogous to the global warming situation, where we saw evidence of a warming planet for years before the changing climate started causing or contributing to drought, low-lying coastal farmland in Asia being infiltrated by sea water, small island natins being swamped by rising sea levels, etc.
I realize there’s a way to argue that the oil prices we’re seeing and the peak oil phenomenon really are two different things. There’s no a priori reason why we would have prices rise only because of the approach to the pea and the inability of cheap oil to meet world demand. But to believe that one would have to accept that the decline of cheap oil in readily accessible areas agrees completely with a near-term peak oil scenario, but then to say that it doesn’t apply to the less-conveniently located (from a geopolitical standpoint) oil reserves by… what magic, exactly? Are we to conclude that “cheap barrels [that] are out of reach in Iraq, Iran and Russia” are somehow immune to the basic fact that you can’t consume a non-renewable resource forever? Or is it that those reserves are so immense that they can be developed enough to both meet growing world demand and compensate for the lost oil production elsewhere?
I suspect we’ll see a lot of back-and-forth on this issue in the coming years. All the most reasonable, to my eye, predictions say that we will see world oil production rise for a few more years–that’s what any prediction that says we’re not at the peak right now means. We finally seem to be coming off the 2005-2007 production plateau, which will cause no end of chest thumping from the cornucopians about how peak oil was a Bob Lutzian “crock”, which is precisely the equivalent of the global warming deniers saying that because one year or one month or one day is unusually cold that the planet is warming and we should ignore the IPCC, Al Gore, et al.
In this context, perhaps one of the scariest things I’ve ever heard is the observation that reality is that which, when you cease to believe in it, still exists.
The ‘Peak Oil’ Theory: Will Oil Reserves Run Dry?:
John Hofmeister, president of Royal Dutch Shell’s US operations, shared his thoughts on the supply issue on CNBC’s Squawk Box on Thursday. He took aim at the peak oil theory as popularized by Matthew Simmons, the author of “Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy.” [See the Hofmeister interview in the original article.]
“The peak oil theory has really swamped the world — God bless Matt Simmons,” Hofmeister told CNBC.
Simmons is mistaken, said Hofmeister, because he is overly focused on a single country: Saudi Arabia, the world’s largest exporter and OPEC swing producer.
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CNBC: What’s your response to critics like Hofmeister?Simmons: There is a kind of schizophrenia within the likes of Shell where the chairman basically says, “We think by 2012 global demand will exceed conventional supply” and yet Hofmeister basically says the idea that we are ever going to have peak oil is ridiculous.
CNBC: But he’s suggesting you are leaving out unconventional sources of energy in your calculations.
Simmons: They make the distinction [between conventional and unconventional], but they don’t seem to make the connection about the vast difference of flow. They are so hung up on the total estimated volume. Once they start in a project they say, “Well, the reserves last forever so we can book a million barrels of reserves.”
The energy that is consumed to get oil out of the oil sands of Canada — in massive amounts of potable water and natural gas — is so vast you are really turning gold into lead. What you get out is a very low quality amount of oil that has to be upgraded and diluted with high quality oil to get synthetic crude. What I can’t figure out is why the executives of these oil companies don’t understand that.
CNBC: And what about the reserves on the Outer Continental Shelf?
Simmons: That’s sort of irrelevant because we have such an unbelievable shortage of deep-water rigs. We are totally out of deep-water drilling rigs. There are about 100 that are struggling to get built. Four will ready by the end of next year.
And none of that deep-water stuff they are talking about has been properly tested to know if it is even commercial. It’s in such remote areas that we just don’t have the tool kit to realistically bring it on stream before maybe ten years from now — maybe 6-7 years from now.
…
CNBC: So, what is your prognosis for prices?Simmons: I think prices have to go way higher. The sooner people get used to the fact that we are still living in a fool’s paradise, the better … you just can not argue that $100 a barrel is expensive when you realize it is 15 cents a cup — do you know anything other than crude oil that sells for 15 cents a cup? I know wine doesn’t, bottled water doesn’t.
OK, a couple of obvious things here:
First, whoever wrote the title on this CNBC article should be slapped with the salmon of enlightenment. We will never, ever see all the reserves “run dry”. Oil will become far too expensive long before that happens. Yes, I realize that it’s imagery and not meant to be a literal depiction, but it still bugs me to no end simply because it’s pointless imprecision.
Second, like you, I’m sick to death of Simmons and his “15 cents a cup” thing. He’s right, but I wish he would give it a rest.
I wonder how many people know that the Canadian oil sands production requires blending that product with “real” oil, or how tight the offshore oil rig situation is. It’s funny how that kind of thing gets mentioned so seldom.
As for the business (pun intended) of the oil companies ignoring the energy return on energy invested, Matt should know the answer to that question. The oil companies measure everything in terms of money, not energy. This is the same reason why we make some insanely large number of “disposable” batteries for cameras, radios, etc., even though the tiny amount of energy they deliver is a fraction of what it takes to make them. All the battery companies make and sell them because we buy them at a price that lets the companies make a profit.
This is a good article to send to friends and relatives who are just becoming aware (hopefully with your diplomatic help) of what’s going on with the world oil situation. It’s a prime example of “brother-in-law material”.
I’ve just posted the first of a series of polls over on the discussion board:
Vote, express yourself, tell me where I’m right or wrong, etc.
I’ve been working this morning on adding a phpBB discussion board to the site. As best I can tell, it’s installed and running properly, and just waiting for my fellow e+e geeks to show up.
You can find it here as well as at a new link in the “Site links” in the upper-right corner of this page.
A few notes worth, well, noting:
Finally, I would “really a lot appreciate it” (to quote one of my all-time favorite movie lines) if you would give the BB a test drive and tell me what you think.
The global warming deniers have been just giddy over the news that we’re seeing a lot of ice coverage this winter in the Arctic. I haven’t commented on this until now simply because it’s been so stunningly apparent that they’re willfully missing the point, namely that it’s not the extent of the ice coverage during winter (a two-dimensional measure) but the total volume of ice (three dimensional) that matters. Add to that their insistence on “look, it’s cold outside my window right now, so how can there be global warming???” logic (to abuse the term), and you have the perfect storm of self-inflicted stupidity.
Well, as always, it makes much more sense to listen to scientists than the pajama-clad keyboard bangers, and the data that’s coming in is more than a little disturbing.
For a quick intro, there’s NASA data shows thickest and oldest Arctic ice is melting:
The thickest, oldest and toughest sea ice around the North Pole is melting, a bad sign for the future of the Arctic ice cap, NASA satellite data showed on Tuesday.
“Thickness is an indicator of long-term health of sea ice, and that’s not looking good at the moment,” Walt Meier of the National Snow and Ice Data Center told reporters in a telephone briefing.
This adds to the litany of disturbing news about Arctic sea ice, which has been retreating over the last three decades, especially last year, when it ebbed to its lowest level.
Scientists have said the trend is spurred by human-generated climate change.
Melting Arctic ice does not raise sea levels as the melting of glaciers on Greenland or Antarctica could, but it does contribute to global warming when reflective white ice is replaced by dark water that absorbs the sun’s heat.
Using satellites that measure how much ice covers water in the Arctic and Antarctic, Meier and other climate scientists found a steep drop in the amount of perennial ice — the hardy, thick ice that is over a year old — in the north.
The oldest Arctic ice that has survived six years or more is the toughest, and even that shrank dramatically, Meier and the other scientists said.
Some 965,300 square miles (2.5 million sq kms) of perennial ice have been lost — about one and a half times the area of Alaska — a 50 percent decrease between February 2007 and February 2008, Meier said.
The oldest “tough as nails” perennial ice has decreased by about 75 percent this year, losing 579,200 square miles (1.5 million sq kms, or about twice the area of Texas, he said.
This doesn’t mean the Arctic is open water during the winter, but it does mean that in many areas, the stronger perennial ice is being replaced by younger, frailer new ice that is more easily disturbed by wind and warm sea temperatures.
A devastating piece on this news is Perennial Arctic Ice Cover Diminishing, Officials Say in today’s The Washington Post:
The amount of long-lasting sea ice in the Arctic — thick enough to survive for as much as a decade — declined sharply in the past year, even though the region had a cold winter and the thinner one-year ice cover grew substantially, federal officials said yesterday.
Using new data from NASA’s ICESat satellite, researchers over the past year detected the steepest yearly decline in “perennial” ice on record. As a result of melting and the southward movement of the thicker ice, the percentage of the Arctic Ocean with this stable ice cover has decreased from more than 50 percent in the mid-1980s to less than 30 percent as of last month.
“Because we had a cold winter, the public might think things have gotten better,” said Walter Meier of the National Snow and Ice Data Center at the University of Colorado at Boulder. “In fact, the loss of the perennial ice makes clear that they’re not getting better at all.”
…
Officials said the loss of long-lasting ice was less the result of warming of the atmosphere than of a long-term rise in ocean temperatures and the effects of the “Arctic oscillation,” a variable wind pattern that can either keep icebergs in the Arctic (when the wind pattern is “negative”) or push them south (when it is “positive”). Climate experts believe that both the rising water temperature and increasingly frequent “positive” oscillations are a function of global warming.…
Flying over the Arctic, one might perceive the sea ice cover as broad, Meier said, but that apparent breadth hides the fact that the ice is so thin. “It’s a facade, like a Hollywood set,” he said. “There’s no building behind it.”
If you’re more the picture type than the word type, NASA has some imagery that will make your hair stand on end. See NASA Media Teleconference: Sea Ice Conditions Multimedia Page, particularly Figure 3, monthly ice area anomalies; Figure 5, ice age distribution in the Arctic; and Figure 6, a time series graph showing ice age.
For a bit more on the latest paper from James Hansen and the increasingly infamous 350 ppm CO2 numbers, see Back to 1988 on CO2, Says NASA’s Hansen. Of particular interest is the swarm of deniers who leap into the comments section on almost and GW-related item on the NY Times sites.
Once again, the problem is that reality is moving much faster than our ability to understand or predict it. Combine this growing mountain of data with the business as usual predictions from places like the US Dept. of Energy/EIA that we’ll be emitting far more CO2 in 2030 than we are today, and I think it’s nearly impossible to escape a couple of conclusions:
First, humanity as a whole will not address this problem as seriously as it warranted until there is a stunning event directly connected to global warming. Given that tropical storm activity and over 30,000 deaths from a heat wave in Europe in 2003 and spreading drought conditions have all failed to sound the alarm, I honestly have no idea what could do it. I’ve seen speculation that the conceptual tipping point will be an ice-free summer in the Arctic. This gives me no comfort whatsoever. I don’t think we can wait another 10 to 20 years before something prods us to leap into action. Plus, I don’t think it would do the trick, in any event, as there would be far too many idiots in the chattering classes who would tell us what a wonderful thing this is because it opens up the Arctic to oil and natural gas drilling and commercial ship traffic.
Second, by the time we collectively put science ahead of ideology and decide to do something about this mess, it won’t be solely a matter of cutting CO2 emissions, but geoengineering the planet with orbital mirrors or seeded oceans to promote plankton growth or who knows what kind of extremely risky scheme in a desperation attempt to reverse the effects of centuries of emissions.
See also
Report: Four Key Clean Energy Markets Increased 40% in 2007:
Solar photovoltaic products, wind power, biofuels, and fuel cells collectively experienced a 40% growth in revenues in 2007, according to a new report from Clean Edge, Inc. Global revenues for the four clean energy markets increased from $55 billion in 2006 to $77.3 billion in 2007. And although the fuel cell and distributed hydrogen market remains relatively immature, with revenues of $1.5 billion in 2007, the three other renewable markets each exceeded $20 billion in revenue. Of the four energy markets, wind power earned the highest revenue, at $30.1 billion. In terms of production, the biofuels industry produced 13 billion gallons of ethanol throughout the world, as well as 2 billion gallons of biodiesel, while solar photovoltaic system installations fell just short of 3,000 megawatts.
The Clean Energy Trends 2008 report looks ahead ten years and predicts that global installed solar photovoltaic capacity will increase eightfold, to 22,760 megawatts, global wind power capacity will nearly quadruple, to 75,781 megawatts, and biofuel production will nearly triple, to 45.9 billion gallons. It also projects a tripling of the three clean energy markets over the next ten years, with the largest growth rate in the nascent fuel cell and distributed hydrogen market, which grows more than tenfold to $16 billion. But for biofuels, wind power, and solar photovoltaic products, the projection actually represents slower growth compared to recent years. For instance, the solar photovoltaic increased fivefold in the past four years and is projected to increase by a factor of 3.6 over the next ten years. That’s a 13.8% average annual growth in the coming decade, compared to 50% average annual growth over the past four years. See the Clean Edge press release, report summary, and full report (PDF 1.9 MB).
The report anticipates continued revenue growth in 2008, and highlights five major trends: the growing participation of overseas companies in the U.S. wind power market; a renaissance for geothermal energy; the launch of new electric vehicles by relatively small startup companies, rather than the large automakers; the use of new, clean technologies for oceangoing ships; and the design and construction of entirely new sustainable cities.
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I’ve mentioned a few times the ongoing question of just how much carbon we can put into the air before we’re in very deep trouble, as in this post. The discussion among experts, as best I can tell, is coalescing into what I call the “350 question”, meaning a debate over whether the old goal of 450 parts of CO2 per million in the atmosphere would be good enough, or whether we must find a way to meet a much tougher standard yet, namely 350 ppm, as some, including James Hansen, argue. Given that we’ve already pushed the atmospheric load of CO2 to a little over 380 ppm and CO2 lingers in the atmosphere for a very long time, this is a question with enormous implications for how we do almost everything, especially related to energy.
The latest from Hansen, et al., on this topic is their paper Target Atmospheric CO2: Where Should Humanity Aim? (38 page, 1.1 MB PDF)
Over on Climate Progress, Joe Romm describes this paper as a “must read”, and I agree, although it’s certainly not a piece of light reading you can do while channel surfing and riding your exercise bike.
The paper’s abstract:
Paleoclimate data show that climate sensitivity is ~3°C for doubled CO2, including only fast feedback processes. Equilibrium sensitivity, including slower surface albedo feedbacks, is ~6°C for doubled CO2 for the range of climate states between glacial conditions and icefree Antarctica. Decreasing CO2 was the main cause of a cooling trend that began 50 million years ago, large scale glaciation occurring when CO2 fell to 425±75 ppm, a level that will be exceeded within decades, barring prompt policy changes. If humanity wishes to preserve a planet similar to that on which civilization developed, paleoclimate evidence and ongoing climate change suggest that CO2 will need to be reduced from its current 385 ppm to at most 350 ppm. The largest uncertainty in the target arises from possible changes of non-CO2 forcings. An initial 350 ppm CO2 target may be achievable by phasing out coal use except where CO2 is captured and adopting agricultural and forestry practices that sequester carbon. If the present overshoot of this target CO2 is not brief, there is a possibility of seeding irreversible catastrophic effects.
As this abstract hints and Joe discusses, the key point here is the amount of warming we get for a given amount of CO2 in the atmosphere. I think it’s easy to lose sight of the chain of causality involved, so let me hammer that point one more time:
What policy makers really need to know is how to map various CO2 emissions Z curves, mentioned in the first bullet above, to the level of human impact, W, for each. That’s when they can start to make the really tough decisions, hopefully with considerable (and considerably) informed participation from the voters, about which steps to take that will avoid climate chaos while minimizing the cost to society of the remedies. How we use energy (mot notably for electricity generation and transportation) will be easily the most important, and most problematic, part of that decision making process.
This is why it is so critically important for mainstream consumers and voters to become involved with energy and environmental issues; it makes precisely zero sense to look at just global warming or just peak oil in isolation. Doing so willingly casts us as the blind men examining the elephant and leaves us reaching horribly incorrect conclusions, but with far worse consequences than the pronouncements of the men in that fable.
Administrative note: I will very likely be changing the approach of this site. Far less news (as in the “Linkage” posts) and far more commentary on individual items, like this post. I need a lot more readers to make this site viable, and that seems like a potential way to achieve that goal and also spend less time assembling all those news roundup posts, which eat up a horrific amount of my day and preclude me from working on the book or personal matters that need attending.
One option, which I’m still toying with, is to launch an alternate site that uses the Scoop software package to create a much more wide-open discussion site on e+e issues. It would be like many of the political blogs, where registered users can post their own stories, comment on things posted by others, rate each other, start mojo flamewars, etc. I think it would draw many more visitors, but I wonder how many of them would be deniers parachuting in to cause trouble, and how much of my time it would consume trying to manage such a site in general.
Please let me know in a comment or a private e-mail (address is on the About page) [1] whether you would participate in such a site, and [2] how you think others would react to it.
Finally, I get the occasional note from people asking me to post a photo of myself. (I suspect this is part of settling some kind of bet; the less speculation about that possibility, the better.) I’ve added one to the About page, at the very bottom.
In this episode: vanishing ice, vanishing oil, vanishing CO2, Chinese vs. American CO2, war bucks
Vanished ‘bridge’ jolts ice pack sleuths:
Canada’s largest research project in International Polar Year has been forced to switch gears because Arctic sea ice is disappearing faster than anyone imagined.
Massive shrinkage of the permanent ice pack last summer scuppered plans to run continuous measurements and experiments starting this month at a semi-permanent base out on the ice, south of Banks Island in the Western Arctic.
…
Scientists had intended to travel to the semi-permanent base by snowmobile from the Amundsen, which was supposed to be moored nearby, safely sheltered in the fixed ice behind an ice bridge.The bridge normally forms every winter across 120 kilometres of the Amundsen Gulf, as drifting ice becomes trapped in a chokepoint between Nelson Head, at the southern tip of Banks Island, and Cape Perry, the nearest point on the Northwest Territories mainland.
But the bridge hasn’t formed this year because ice floes are passing freely through the chokepoint into the Beaufort Sea, which is relatively unclogged because of the shrinkage in the ice pack. Scientists estimate that an unprecedented 1.3 million square kilometres of ice disappeared in the summer of 2007 from the permanent Arctic ice pack, the zone that remains ice-covered at the height of summer.
Oops.
Shell to write off half of last year’s reserves:
Shell is to slash reserve figures from last year by more than half, taking about 1.3 billion barrels of oil off its books, equivalent to about a year’s production.
Chief executive Jeroen van der Veer is also expected to say that production growth will be zero or near zero until 2010 when he gives the oil giant’s annual strategy presentation tomorrow.
Oops, again.
Government figures hide scale of CO2 emissions, says report:
Britain’s climate change emissions may be 12% higher than officially stated, according to a National Audit Office investigation which has strongly criticised the government for using two different carbon accounting systems. There is “insufficient consistency and coordination” in the government’s approach, the NAO said.
Using one system, which the government presents to the UN and in public, Britain emitted 656m tonnes of CO2 in 2005, and claims an improvement on 1990 figures. However, the lesser-known but more accurate data in the government’s national environmental accounts show emissions to be in the region of 733m tonnes in 2005, a NAO report says today.
“There are two different bases on which the government reports emissions: that required for the UN, and the environmental accounts prepared for the Office of National Statistics … [which are] more comprehensive as they include aviation and shipping emissions. They present UK progress in reducing emissions in a markedly different light”, says the report.
Honestly, I don’t know whether to make a “Bush is consulting before he leaves office” joke or an “I guess I know what the sub-prime morons from the US are doing now” joke.
You can decide for yourself after reading the report (40 page, 770KB PDF).
Analysis: China’s CO2 burden falls on U.S.:
Any solution to the world’s energy woes hinges on two pivotal players, the United States and China, and most of the heavy lifting may fall on the wealthier of the two, experts said at an energy summit Thursday.
In recent years, China has undergone an unprecedented development boom, accompanied by skyrocketing energy consumption, and overtook the United States last year as the No. 1 emitter of carbon dioxide, according to most estimates.
The International Energy Agency projects the two countries, by 2030, will account for 45 percent of global greenhouse gas emissions.
This places the two energy giants in the hot spot when it comes to stopping climate change, said Kelly Sims Gallagher, director of the Energy Technology Innovation Policy research group at Harvard University’s Belfer Center.
“The United States and China are clearly the two countries with the unique ability to make or break the climate change threat,” Gallagher said Thursday at an energy summit hosted by the National Academy of Sciences. “If either one fails to effectively manage their greenhouse gas emissions during this century, it’s really almost impossible to substantially reduce the threat of climate change. If both fail, the game is really over.”
…
“(The Chinese) don’t have a very good handle on where their emissions are coming from and where they’re going to go in coming years,” Lewis told UPI. “The U.S. has an important role to play in building the greenhouse gas registries, the quantification systems and the ability for people to understand the drivers behind their emissions.”
The sheer magnitude of this problem and the potential ramifications of not solving it are truly terrifying.
There are times when I think our best bet is to round up all the kids, like the middle schoolers I’ve presented to who had no concept whatsoever of the meaning of the word “can’t”, and put them in charge. Obviously the adults aren’t doing such a great job.
War’s price tag (emphasis added):
The war in iraq, which will enter its sixth year this week, is turning out to be the most expensive conflict since World War II, and the cost will fall especially hard on Californians.
By the end of 2008, the federal government will have spent more than $800 billion on combat operations in Iraq and Afghanistan (government accounts make it hard to separate the two). On top of that comes a mountain of future costs: caring for war veterans (to date, more than 1.6 million troops have been deployed), replacing the military hardware that is being used and worn out in Iraq and paying interest on the enormous sums of money we’ve borrowed to finance the war.
All told, we estimate that the cost of the war will easily reach $3 trillion in today’s money. This number assumes that the U.S. begins a pullback from Iraq after the election in November but retains a small presence there for the next decade.
Three trillion dollars.
Three trillion freaking dollars.
As in $3,000,000,000,000.
I will leave it as an exercise for the reader to figure out how much wind power (at about $1.50/watt) or solar power ($8/watt, pre-thin film revolution), you could buy with three trillion dollars. Or how many schools you could build or renovate or how many home owners you could give a free high-efficiency furnace or home insulation or solar thermal system.
There are some things I no longer have the stomach for.
And let us not for a nanosecond overlook the vastly greater human cost of Bush’s war. Approximately 4,000 US dead, tens of thousands injured, many permanently, hundreds of thousands of Iraqi civilians killed or wounded or turned into lifelong enemies of the US, etc.
In this episode: US economy, China’s fuel demand, melting glaciers, two views of biofuels
Futures tumble on Bear Stearns fire sale:
Stock futures plunged on Monday after JPMorgan Chase (JPM.N: Quote, Profile, Research) bought Bear Stearns (BSC.N: Quote, Profile, Research) for just $236 million and the Federal Reserve took emergency action to provide cash to Wall Street, raising concern that the credit crisis is spiraling out of control.
The Fed made an emergency quarter-percentage-point cut to its discount rate to 3.25 percent and expanded lending to a wider range of big financial firms, in the first such move since the Great Depression of nearly 80 years ago.
JPMorgan is buying Bear Stearns for $2 per share, or just one-fifteenth of the price the shares closed at on Friday. Shares of Bear, the fifth-largest U.S. investment bank, reached a high of $172.61 last year.
Once again, remember the basic causality chain: Housing and credit sector problems = lower interest rates = weaker US dollar = higher oil prices contributing to a much greater inflationary push than would be normal for rates at this level. Add to that the parallel vector of recession = lower stock prices = money looking for a safe haven = increased demand for US treasuries = more downward pressure on interest rates, and the story just gets uglier.
The FOMC (Fed. Open Market Committee) will be making another interest rate change tomorrow, widely assumed to be somewhere between a half and a full percentage point.
Related:
Wall Street in crisis of confidence