Friday, September 4, 2009
Van Jones, Green Jobs Czar
Longtime readers may remember this post about Van Jones from last fall ("A Green New Deal?"). At the time, I didn't know he'd be picked by the Obama Administration to be a 'green jobs czar', but I figured his ideas would have some valence with team Obama. Now he has gotten into trouble for some past statements and actions unrelated to his green jobs advocacy (See The New Republic: "Is Obama's Green Jobs Guru In Trouble?". HT: Ta-Nehisi Coates). In a way, this is unfortunate, because it detracts attention from the weakness of his "green collar economy" thesis. How can a robust, job-creating economy be built on winterizing homes and installing more expensive sources of energy?
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16 comments:
"There is no shortage of venture capital money investing in alternative energy, but you can't legislate the pace of technological progress."
Intuitively, I would agree with you. However, as they say, 'necessity is the mother of invention'. A few years ago I read an article in Invention and Technology magazine about the invention of the catalytic converter in order to meet an emissions mandate. I guess congress figures since they did it before, they can do it again. Unfortunately, as in investing, past results don't ensure future performance.
You ask: How can a robust, job-creating economy be built on winterizing homes and installing more expensive sources of energy?
You're asking the right question the wrong way. Some smart people were asking a similar version last summer, "How can a robust, job-creating economy be sustained with high energy prices?"
Soon after we found the answer. It can't.
Anon,
I'm not the one advocating policies that will lead to higher energy costs. See this post of mine from last year, comparing energy prices and unemployment rates in two states (A Tale of Two States: Utah versus Rhode Island". I'll update that with another comparison soon, but I suspect we'll see a similar correlation.
An investment in "green energy" will lower energy costs in the future. Solar, wind, silly stuff like that has a longer payback period compared to so-called conventional sources but beyond payback, these sources have a higher NPV. Sure, it's fun to take a giant boat out into the middle of the storm-ridden gulf of Mexico and drill a hole 7 miles into the earth to (hopefully) strike oil... but it's just not practical.
Obama's people have been making some bad decisions lately, with the clunkers and the dictator speech for first graders. Apparently, Reagan and Bush1 did that type of thing, but it's something that they should have known wouldn't be received well. Obama's not talking to the kids.
"How can a robust, job-creating economy be built on winterizing homes and installing more expensive sources of energy?"
How did the manufacturing of a bunch of planes, tanks and boats that got sent to be blown up stimulate the economy in WWII?
The point of renewable energy, is that over the long run, it is less expensive. Because it is renewable.
There's a farm near me that installed a bunch of solar panels that provide all of the energy they need plus a surplus to sell back to the electric company. The loan will take the famers 7 years to pay off. After that they won't have any electricity bill into perpetuity. I used to be more skeptical of wind and solar power, but efficiency in this space is accelerating exponentially. These options are probably not as good as geothermal for large scale energy production but I see how they can give more people a stake in energy generation and create more jobs. It's not like the little guy can have a geothermal plant built on the few acres he owns.
If the US is a technological leader in the green industry, a lot of jobs can also be made by our companies selling our tech to countries that need it much more than we do, such as China and India. I'm told if you doubt the harm coal burning plants do to the environment you need to breath the Beijing air for a week.
My only concern with Obama's green jobs guru is that he isn't doing enough, not that he's wasting his time in the sector. Where are the collaberative plans with NASA to launch satellites to collect solar power? We need big, 60's Space Program type projects.
Sheeeesh... compared to buying billion dollar F-22 jets to fight muslim terrorists, solar panels are a screaming bargain!
"The point of renewable energy, is that over the long run, it is less expensive. Because it is renewable."
In small scale examples like the local farm you mention, this might be true in some cases, but where that's true, sellers of solar panels and windmills ought to be able to sell that value proposition. Selling cheaper energy over the long term shouldn't be a hard sell, right?
As you note, the large scale applications of wind and solar don't really make economic sense in most cases. If memory serves, the developer of a huge proposed offshore wind farm on the East Coast (off of Maryland?) explicitly acknowledged that the per-kilowatt hour cost of electricity would be higher than current sources, even with the government subsidies. His pitch was that it may be higher, but it would be stable at that higher level, unlike fossil fuels which might spike in price.
"These options are probably not as good as geothermal for large scale energy production but I see how they can give more people a stake in energy generation and create more jobs. It's not like the little guy can have a geothermal plant built on the few acres he owns."
I have no problem with the little guy putting up solar panels if it makes economic sense for him. Often though, it doesn't, even with the subsidies and tax breaks. See, for example, this essay by Sandra Tsing Loh, about her experience trying to go solar in sunny Los Angeles.
"If the US is a technological leader in the green industry, a lot of jobs can also be made by our companies selling our tech to countries that need it much more than we do, such as China and India."
Spain's the world leader in wind power. How's that working out for them as a jobs engine? Have you checked the unemployment rate in Spain recently? It's nearly double ours, at 18.5%.
"I'm told if you doubt the harm coal burning plants do to the environment you need to breath the Beijing air for a week."
You're taking the same tack as James Hansen there, so I'll just refer back to Freeman Dyson's response to Hansen.
OT: Did you get my PM to you via GuruFocus earlier this week?
Note also Dyson says there are many good reasons to prefering solar to coal. China isn't so poor that it can't afford to buy cleaner products for its people that are developed in the US. Anyway we could go back and forth about this for a while so I'll stop there.
Sorry, I havent logged into GF for a long time, I will go there and check it now.
Also I want to add that I think underwater turbines that harvest the energy of the oceans currents make more sense than offshore wind farms. Large currents like the Gulf Stream are fairly constant and pack more punch than intermittent surface winds.
Payback period is intuitive but NOT an ideal way to analyze investments. In the example of the article you referred to, it doesn't take into account the 5+ free years of electricity she's guaranteed to get after the price of her system is recouped. Some panels installed in the 1950s with inferior technology are still producing. Also, in 10 years, her electric bill could be more than it is now.
I installed a 5kw system on my house for $12k. I did it myself. I replaced my heating system and all my natural gas appliances with energy efficient electric appliances (I live in a mild coastal climate that is also very sunny). The total cost was $15k including insulation after generous rebates & tax credits. My house is 100% energy neutral. I did it because it was a fun. I have eliminated one more liability from my life for the next 25 years. Some people blow $50k on a guzzler that costs $100 to fill up. Some people, like myself, blow $15k retrofitting their house to be energy neutral. Spend money however you want. I like my electrons.
People laugh at me... energy is energy. I laugh back. In a past life I convinced people that one brand of vodka was better than another brand of vodka. It's all the same. You can't tell them apart if you with a science lab yet zillions of people happily convince themselves that they are better than others with their absolut.
Funny how the world works!
"Sheeeesh... compared to buying billion dollar F-22 jets to fight muslim terrorists, solar panels are a screaming bargain!"
When our interests collide with those of the Chinese or the Russians in the future, it will be tough to deter them with solar panels and winterized houses.
In other news, The Van pulls away.
Our interests won't collide if we're not importing 98.965% of the world's oil production.
We have points of friction with Russia and China that don't have to do with oil (e.g., Taiwan, weapons proliferation, our alliances with former Warsaw Pact countries, etc.
not so much the message ,but the somewhat crazy messenger.In politics your controversial comments and associations will kill you.maybe he had some good ideas,but live by the sword and die the same way.
Treaties are just pieces of paper. What matters is what a country's interests are at the present, not some piece of paper they sign decades ago in a completely different geopolitical setting. Our alliances with warsaw pact countries today have a lot to do with contolling energy pipelines through the Black Sea. See: Georgia conflict
And I doubt we care about Taiwan anymore. If China invaded them tomorrow we wouldn't fulfil our military obligations...we'd issue a UN resolution slap on the risk. The Taiwanese know this, which is why they are leaning more and more toward reunification.
As far as F-22's, they are like highly trained calvary in the 1920's, before they were decimated by tanks. Just a pet project for powerful military-industrial guys that will be useless against the technology in final stages of development now, begging to be released (satellite based gravity weapons, visual-spectrum cloaking, unmanned robot swarms, etc). 'Top Gun' is a nice fantasy but there are no need for arial dogfights anymore. The technological law of accelerating returns holds true for the amount of destruction per [insert monetary unit] also.
In more related news, Google could make Solar cheaper than coal in a few months time. Technology does not progress in a linear fashion. It won't be long at all before renewable sources of energy are much less expensive than fossil fuel. The idea that energy is some kind of rare, expensive-to-harvest resource on our planet is patently false. On the contrary our planet is bubbling over with excess energy, from sources that will (practically) never run out.
On a more personal note...my father (who happens to be a conservative Republican, not the kind of person who does this thing to be cool) announced this weekend that he had crunched the numbers and concluded that instaling solar panels on the top of his house would be a good investment, so that will be his project sometime soon.
The big energy shift is coming.
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