Wednesday, 6 July 2011

Yet more proof "global warming" is overblown

Many of the global warming doomers claim that if we "don't limit" temperature increases to 2C or less (and thus kill the economy in doing so) then we will possibly end up with runaway global warming. I have always doubted this because the eocene, hot as it was, didn't end up with runaway global warming even though there was MUCH MORE C02 in the atmosphere than today.

Seems that even in the Eocene it wasn't quite the horror story that the ridiculous computer models by the eco-fanatics would suggest:

Hot off the presses from yale university:
""The early Eocene Epoch (50 million years ago) was about as warm as the Earth has been over the past 65 million years, since the extinction of the dinosaurs," Ivany says. "There were crocodiles above the Arctic Circle and palm trees in Alaska. The questions we are trying to answer are how much warmer was it at different latitudes and how can that information be used to project future temperatures based on what we know about CO2 levels?"
Previous studies have suggested that the polar regions (high-latitude areas) during the Eocene were very hot -- greater than 30 degrees centigrade (86 degrees Fahrenheit). However, because the sun's rays are strongest at Earth's equator, tropical and subtropical areas (lower latitude) will always be at least as warm as polar areas, if not hotter. Until now, temperature data for subtropical regions were limited.
The SU and Yale research team found that average Eocene water temperature along the subtropical U.S. Gulf Coast hovered around 27 degrees centigrade (80 degrees Fahrenheit), slightly cooler than earlier studies predicted. Modern temperatures in the study area average 75 degrees Fahrenheit. Additionally, the scientists discovered that, during the Eocene, temperatures in the study area did not change more than 3 to 5 degrees centigrade across seasons, whereas today, the area's seasonal temperatures fluctuate by 12 degrees centigrade. The new results indicate that the polar and sub-polar regions, while still very warm, could not have been quite as hot as previously suggested"

Saturday, 2 July 2011

The Most Recent Deutsche Bank Peak Oil Report

I reckon many if not most Doomers would read the latest Deutsche Bank Peak Oil Report as spelling doom because they come out and say they expect a peak oil price shock as early as Q2 2013.
Taken out of context that's only two years away so if at that point we were to experience global supply drops, increasing demand (from e.g. China and the Mid-East) combined with no available substitutes we would be doomed.

We're not, however, doomed. Here's why: The Deutsche Bank report although it's an outstanding piece of analysis (and I congratulate them on it) are missing the substitution effect that natural gas vehicles will bring to bear. They have, however, provided what I can only describe as a near-perfect analysis of the effect hybrids, plug-in hybrids and electric cars will have on the transportation market and by extension, the oil price.

To quote from the report what I personally consider to be the most salient setion:
"The market is trying to shift US behaviour towards long term greater efficiency, and as we
have highlighted, that process is starting with the bankruptcy of the US auto industry and the
imposition of greater MPG requirements that may yet prove to be, in our view, be the largest
and least appreciated achievement of the Obama first term. As we have highlighted, and
expected, as automakers compete to build hybrids and electrics their costs will fall, lowering
the oil price at which they become economically attractive. As shown below, we are not at a
high enough price yet to incentivise a US consumer to buy a Prius instead of a Corolla for
purely economic reasons based on greater efficiency vs relative price premium, but that point
is rapidly approaching and explains why our long term price charts have falling real prices. By
2014, US consumers will be incentived to buy a hybrid rather than conventional car at
$3/gallon and falling."

here's my observations and analysis from this piece:
1. Americans are stubborn SOBs and the major problem is that Americans don't want to give up driving big trucks. But they *will* and it will happen within the next five years.
2. There's likely to be another recession in the US around Q4 2013 forced by high oil prices
3. The costs of driving hybrids and electrics will fall due to lowering battery prices and competition so much that it will be a no-brainer to do so. Especially when faced with the choice between taking the bus or driving a smaller electric vehicle. All those F-150s will be left sitting on the driveway and kept only for cases where it's economic to use them (like driving to Disneyland with a family of four as opposed to flying).
4. 2013-2014 is going to be interesting
5. The Canadian dollar will likely be significantly higher than the US dollar during 2013.
6. Electric vehicles such as the Nissan Leaf and Plug-in Hybrids such as the GM volt will likely be sold out and going for higher than sticker price during 2013
7. Diesels will likely also be sold out and going for higher than sticker price during 2013
8. There will be a secondary market in conversions to natural gas for those who can't get their hands on electrics or plug-in hybrids or diesels.
9. I predict I myself will be driving a volt or a nissan leaf or equivalent or else a natural gas vehicle on or before 2013.