Tuesday, February 28, 2017

Environmental footprints

After Obama was elected, businesses thought that environmental regulations were coming. Pepsi/ Tropicana researched the carbon footprint of orange juice, finding that fertilizers were the biggest part of the impact. Now, eight years later, I see the second footprint analysis, finding again that for a food product (in this case bread) the impact of fertilizer comprises 40% of the impact. That far outweighs transportation, packaging, and all other individual part of the story.

A few questions: first, why are these analyses still so rare? The more recent one was done by academic researchers, highlighting the answer to my question: government doesn't require them. I guess it's like the gun lobby banning research on guns- if you don't hear about it, it must not be a real issue. Second, how about that fertilizer? That's really a problem: it's come up big in two studies. I wonder what % of food's carbon footprint is attributable to fertilizer? As Lamar Odom used to say, "Not small!"

Thursday, February 16, 2017

Heartland vs. Trump

One way Mexico may try to indicate their displeasure with our current administration is to buy fewer products from the US. One large US export, corn, goes predominantly to that country, and though it's not as easy as they would like to find another supplier that can produce as much as we can here in the US, a significant cut in their imports could adversely affect the price of US corn, and hurt farmers' pocketbooks. Since these farmers are living on a fairly thin margin, with costs up and revenue down over the past few years, a drop in prices could really hit agriculture where it hurts. Otherwise, the prognosis is for corn prices to stay about the same in the short run, at least.

Tuesday, February 7, 2017

Update on offshore wind

For years I've been telling my Resource Econ class that offshore wind just isn't economic. I hadn't been able to find any cost estimates since the EIA posted these in 2011:

With Offshore looking like it costs three times the price of onshore wind, it didn't seem to make much sense. However, the tech seems to have improved over the past five years. (Go engineers!) This NYT article says that costs on one project were as low as 78 Euros/MWh or about $83. Wow! That's quite an improvement. If those costs are sustainable, i.e. not just building costs but maintenance costs and all, that could be huge. Some good news in bleak times for clean energy....

Monday, January 23, 2017

Environmental regulations and jobs

This Atlantic article sums up some recent research on the relationship between environmental regulations and jobs. Although they soft-pedal it, their summary concludes that job losses are indeed associated with environmental regulations, though they also note that such claims are often inflated.

However, we must also consider some countervailing factors. First, it's often true that one person's loss is another's gain. Over the last 5-10 years, the coal industry has done a major faceplant as the fracking industry has increased operations. That means fewer jobs in West Virginia but more jobs in Pennsylvania, for example, and not everyone who lives in West Virginia is able to retool their skill set and easily move several hundred miles away to take one of the new jobs. So, there are winners and losers from this market change. Who do you think will make more noise: the losers or the winners? 

It's important to note that this change didn't happen as a result of regulations: as technology improved, it just got cheaper to frack than to mine, so the change happened sort of organically. Regulations can have similar effects, though, for example if they require coal to meet certain emissions standards.

Lastly, and most importantly, the other winners from environmental regulations- who often don't even realize they're winning, and therefore are even less likely to speak out- are the people living downwind. When comparatively clean-burning natural gas is used to generate energy instead of coal, less CO2 is emitted and less particulate matter as well, meaning that people living near and far will be healthier. Unfortunately, in most cases politicians don't benefit from these health improvements, so that makes them less valuable to policymakers.

In other words, it's not as simple as they'd have you believe!

Market forces and energy

Thanks to @BorensteinS for linking to this Bloomberg article. Wyoming wants to raise the cost of wind energy via taxes, just to promote coal and natural gas. This can of course do some damage, but it shows how market forces are arrayed against those legacy energy sources. Not surprising, but yet again sadly ironic how the pro-market ideology goes out the window when it's convenient. Populism run amok.