Photo by Beedle Um Bum on flickr

By Robert Bryce, Public Affairs Books. Posted May 10, 2008.

While energy efficiency is laudable, history shows that it leads to people consuming more energy.

This is a longish piece but worth sticking with. It is more on the arguments that were advanced by Mark Jaccard when he advocated carbon taxes. We have seen advances in energy efficiency in a range of applications, but the energy savings do not tend to go to fatten our bank accounts. In fact we tend to consume more energy than before.

And of course this is not new. I heard about the Jeavons Paradox as a spotty six former.

In 1865, a noted British economist, William Stanley Jevons, published a book that would become his most famous work, The Coal Question. Jevons’ book was the beginning of what is now known as the field of energy economics. After studying coal consumption patterns in Britain and assuming (wrongly) that his country’s coal deposits would soon be exhausted, Jevons concluded that “It is wholly a confusion of ideas to suppose that the economical use of fuels is equivalent to a diminished consumption. The very contrary is the truth.” This observation has since come to be known as the Jevons Paradox.

In fact it often strikes me that the people who prescribe economic nostrums based on the illustrations used in Econ 101 “Perfect Competition” seem not to notice that the real world is nothing like as simple as that abstraction. Though they behave as though it ought to be, which is even sillier.

I have often quoted the remark (though I cannot recall its source) “It they were all Zero Emission Vehicles tomorrow, we would still have the problems”. Yes, hybrids are better cars, just as there may well be better fuels, but it is the car itself that is the real problem. Cities were around for five millennia before the car and though everyone complained about the crowds, and the smell, they still lived in them and benefitted economically, socially and culturally from their existence. At the end of the nineteenth century, as public transport was introduced and later electrified, city life got better and cities expanded. Death rates from communicable diseases plumetted thanks to better science and better drains. People no longer had to live next to the job, which was a big improvement if it was in a rendering plant.

The Garden City movement thought that better urban environments would produce better people - an idea Frank Capra repeated in “Its A Wonderful Life” (a paean of praise for the Savings and Loan business). But neither had imagined what would happen if nearly everyone owned at least one car, and tried to drive it everywhere. Which is where we are stuck now - and where our current leadership seems content that we stay.

In fact it also occurs to me now that the argument about energy efficiency also applies to road building as way to manage traffic congestion. Because roads are not priced, buidling more of them induces more demand . For a brief moment there is some space. But just as when you leave a comfortable safety cushion between you and the car in front, someone pops in to the gap and fills it up. And we end up with more congestion than when we started. They could all be Smart cars or hybrid SUVs - but the results in terms of travel time and sprawl would be exactly the same.

Better cars and better fuels will be made, but we will not produce better places if that is what we rely on. In fact they will get much worse.

Not so long ago we were engaged in a debate about how transit could be made free to use. This article in the Guardian purports to explain how things can be given away, and by operations that make lots of money. Which I thought was good until I came across this paragraph

But even that was good news. High-street bookshops might not have space to stock those Compton-Burnett novels I so ardently crave, but some warehouse off the M1 near Daventry might supply my outre demand if I ordered online. What is more, the internet could link geographically distant secondhand booksellers into one webpage. As a result, I need not visit Hay-on-Wye to trawl secondhand book shops. I could instead buy a book online, thereby saving me travel costs, while incurring negligible postal charges. In so doing I would be making someone outside the book-retailing mega-chains a few bob. Which has to be a good thing, doesn’t it?

Yes and it already exists and has done for some years. The site is called Abe books and it was started by a secondhand bookshop in Victoria BC and has already transformed the used book business. And not just in Canada.

When I read a newspaper like the Guardian I assume it is written by people who know what they are writing about. Of course in my own specialized sphere, I do not expect them to be quite as knowledgeable. But something like this really begins to make me doubt the value of my source. And Guardian is still one I refer to a lot out of more than just nostalgia.

But there is some kernel of wisdom here. Right now tax payers pick up half the bill for transit - and here in Vancouver BC that translates into high fares and poor service for most of the region. And because it is a monopoly and under control of government, innovation is rare and sputtering, and often in bizarre areas of little concern to the people trying to get on a crowded bus. But money gets spent on things that appeal to politicians - and they seem to think they know better than we do what we ought to want.

So there could be a way to do free to user transit - but as long as the present system of (mis) governance persists, I do not see how we can break out of the mould that has trapped us in an expensive system that still only carries 11% of the trips at high cost to riders and taxpayers, and does not serve most of the geographic area very well - and some of it not at all.

One of the truly silly ideas floating around the US election. McCain started it saying Americans should not have to pay gas tax in the summer. Hillary followed that up with the idea that the oilcos would be forced to pay the tax for their customers.

From this morning’s ABC “town hall” with Hillary Clinton, about the gas tax holiday:

STEPHANOPOULOS: “But can you name an economist who thinks this makes sense?”
CLINTON: “Well, I’ll tell you what, I’m not going to put my lot in with economists.”

We can’t get no respect

can we afford it?

B.C. has been hit by the sharpest wage decline in Canada. We have less purchasing power now than we did in 1981, figures from 2006 census show.

And the article looks at some of the reasons why that it so. But what it does not say of course is that much of the recent decline has been due to government policies. The attack on the support workers in healthcare, the continuing privatization of what were once secure public sector jobs. Taxation has been shifted from progressive to regressive - that is what happens when you cut income taxes for the well off but raise all the other fees and charges to pay for services.

Since this region is also the most expensive in terms of housing many households have to have multiple wage earners. Not just Mum and Dad working - and not unusually more than one job, or longer hours - but the kids cannot afford to leave home. Or people hit by adversity later in life having to move back into the family home.

Immigration is the other big headline story - and we have more of that then other places too. And immigrants are paid far less than Canadian born, and their education and qualifications are ignored to “protect” the interests of those already established. This is a huge drag on the economy, as we need the skills and knowledge of the engineers and surgeons who are running 7-11s and driving cabs.

Add rising food and fuel costs to this picture and you begin to understand why people having been feeling more and more under pressure. What is distinctly odd is that this does not seem to affect the government’s polling numbers very much, and they continue to behave as though their re-election next year is in the bag.

Guardian

In 2007 Sweden topped the list of countries that did the most to save the planet - for the second year running - according to German environmental group, Germanwatch.  Between 1990 and 2006 Sweden cut its carbon emissions by 9%, largely exceeding the target set by the Kyoto Protocol, while enjoying economic growth of 44% in fixed prices.

It has not even got started here yet, but we are being flooded with tales about how terrible our tiny carbon tax is going to be.

Sweden can lay claim to the world’s first train running solely on biogas.

Photograph: Jeppe Gustafsson/AFP

Well, we can expect some teething troubles, and nowhere does a policy translate directly. Bit I think Canada and Sweden have a bit in common. They just don’t have the space, oil and gas that we do. Which is why they pursued this initiative with such vigour. They realised early on that reliance on imported oil was not a good idea. The ghg reductions were kind of a bonus.

I know a lot of environmentalists - and others - now regard “growth” as a dirty word, but the Swedes have shown you do not necessarily need to trade off the environment against the economy.

Anyway, I thought it was about time for something positive for a change.

Harvey Enchin’s faith in free markets is touching: the invisible hand will sort out every problem for us. As long as we have no governments “interfering”.

He does acknowledge the finite nature of fossil fuels, but I see not one reference to climate change except for a personal attack on Al Gore. Which is not really a very convincing way to make a case. If King Abdullah is really protecting his reserves for future generations, he is a lot smarter than most observers give him credit for. The analysis I have seen has suggested that the reserves have always been a closely protected secret, but the suspicion is that is because there is a lot less there than they say.

Of course the size of the reserves anywhere is very much a function of the price of oil. When exploration found reserves off Newfoundland, a lot of energy economists that I knew were frankly sceptical that it would be worth exploiting, but back then $120 a barrel oil seemed far in the future. It also doesn’t help that we are trying to measure prices in terms of a declining currency. It is a bit like using a tape measure made of elastic.

But Harvey also does not mention that there can be very sound reasons for not developing oil reserves, and in the case of Canada’s west coast, it was not just the First Nations that raised concerns about the fragility of the ecosystem here. Indeed, everyone was affected by the Exxon Valdez - and many still are - and the credibility gap of the oil industry and its claims of being “scientifically sound and environmentally responsible”. Erm, no. Not on the present record they’re not. Denying climate change and funding bogus “scientific papers” supporting their financial benefit over the fate of millions of people is not sound science or responsible.

Yes some government policies are dumb. But what else do you expect when you let some large corporate interests put up a sock puppet for president, rig the election results and then start declaring war on trumped up reasons? Hopefully this will end shortly, and we can return to sanity. And the unwillingness of oil companies to invest in

Kazakhastan, Azerbaijan, Turkmenistan and Uzbekistan; Bolivia, Venezuela, Columbia and Ecuador; Russia, China, Saudi Arabia, Sudan, Nigeria, Iran, Iraq and Kuwait

is understandable but then the ability of others to exploit these resources is also a distinct possibility. Certainly the Chinese do not lack the financial resources, although I bet now they wish they had diversified out of dollars some time ago.

On the whole I would rather that we leave the BC coast alone. It is going to be hard enough to mitigate the effects of the Deltaport, the loss of wild salmon and much of the migratory bird population and clean up the mess that Atlantic salmon farming will have left after that dumb policy is ended. If there are petroleum resources there, let us hold them against future needs for products that we are going to have a hard time making in future. There are a lot better things to do with oil and gas than burn it!

But mostly let us review the dumb policies and come up with smarter ones, which will make this place a better one to live in for everyone - not just us. A dumb policy is not just one that seems to block private investment. A dumb policy is one that continues to make the same mistakes and expects a different outcome. Reducing the size of our footprint is something we really do not have much choice about if we take a long term, broad view of the future. Now that may look disadvantageous to the fast buck crowd, but that is just tough. They will have to accept that we are entitled to expect more from them - in terms of environmental protection and restoration, and longer term sustainability.

The point of the peak oil argument is not the date - now, last year, next tear, twenty years away. It is inevitable. A dumb policy is to wait until we have absolute certainty that it is too late and then change behaviour. We have to make adjustments - we should have been making adjustments - our competitors have already made adjustments and have sounder economies as a result (the Euro is not getting stronger just on a whim).

And we also only have one planet. As far as we know this is the only planet that can support life as we understand it. We have yet to discover another - and any candidates are currently well beyond our reach. Looking after the one we have and ensuring it can continue to support us is not a dumb policy at all. Dumb is ignoring that reality and concentrating on fast profits and quick returns.

You know you are doing something right when you get three emails, within minutes of each other, suggesting things to blog about.

I am going to pass on the suggestion (sorry, Mr Holden) of the Walmart in town story - it is too close to the “even Walmart” comments at Smart Growth and the thing I did on big boxes on Cambie not so long ago. I am also not going to delve into energy corridors in Wyoming which sound dreadful but also dreadfully complicated.

I recently linked to an article in the Atlantic, so someone there suggested I take a peak at “A steamy solution to global warming” by Lisa Margonelli

Economists like to say that rational markets don’t “leave $100 bills on the ground,” but according to McKinsey’s figures, more than $50 billion floats into the air each year, unclaimed by American businesses. What’s more, the technologies required to save that money are, for the most part, not new or unproven or even particularly expensive. By and large, they’ve been around since the 19th century. The question is: Why aren’t we using them?

Because corporate America doesn’t have to think. It has George W and a hot line to some compliant congressmen and lots of really smart lawyers. As long as there no real reason to do so, why would they think outside the box? Much more comfortable to follow the herd, and buy a table at the next Republican fundraiser. The US government is spending trillions of dollars to ensure that Iraqi oil still flows their way, so why worry about energy efficiency?

Back in 1970 a senior plant manager at ICI told me - quite seriously “There is no money in pollution” - but he was paying my organisation lots of money every year to pull out of the river the guck that his plant was dumping in it further up stream. So that craft serving his plant had enough water under their keels to load efficiently. How do you argue with people like that?

I recently pointed out that we do not in general spend a lot on community energy systems here. Although the City of North Van did and the former Mayor of Vancouver owns a steam distribution business in downtown Vancouver. Because we put what little industry we have left way out in the boonies there are not many ways to connect industry waste heat to places that need heating. But I can think of a few. For instance the cement plants in Richmond and Delta (LaFarge and Tilbury) produce loads of waste heat and they are not so far away from greenhouse country. The last refinery here - Chevron in Burnaby - could send heat to SFU. And then there is the thermal generating station near Ioco. It burns gas to heat water to raise steam to turn the turbines and then dumps warm water into the inlet. And the idea of using more efficient combined cycle gas turbines has been rejected there more than once. Gas turbines also have the advantage of being able (like hydro dams) to meet peak loads very quickly indeed. No, I don’t know why they preferred steam. The reason I mention this location is that it is under review for some major redevelopment by that very smart chap who did SFUniverCity - and I bet he could work a community energy system into his development

Photo by Richard Eriksson

Even post industrial Vancouver can get into the heat recycling business. It just requires a change in mind set. For instance what was once BC Hydro could think about selling energy - not just generating electricity. But of course, here it would have to find a P3 partner to skim off the profits first

APTA Press Release

I must admit a strong temptation to just cut and paste the whole thing. But that is not a web log is it?

The White House and John McCain are the only ones out of step on this issue. Stopping the growth of emissions by 2025 - by voluntary measures alone - is pathetic as a target, woefully inadequate and probably will not be attained at present rates of progress. Emissions globally have to be cut - and cut drastically. It turns out that the model was wrong. The oceans are not absorbing CO2 as predicted. And Geoffrey Stern (the economist who produced an evaluation of the costs and benefits of tackling climate change eighteen months ago) admits now he was wrong. Climate change is happening faster than he thought then.

Of course the paid flacks of the oil and automobile industry accused him at the time of “scare mongering”. Either he was not scary enough or they were too successful in confounding the decision making process. But then the people who make the most money have already bought themselves patches of higher ground to retreat to as the sea level rises. Just like the hedge funds that did well out of the credit crisis. The strategy appears to be to try and manipulate the markets - because money is made of the change or “spread”. You can make money on the rising cost of  oil and gas as the shortage due to passing the peak gets worse - but deny in public that there is a peak at all - or if there is, it’s a long way off. You can make money by snapping up properties at fire sale prices due to mortgage defaults and repossessions. You can start buying shares in promising technologies - especially if you can persuade governments to give you a tax break or an outright grant. Shares in railroads are a good bet now - airlines not so much. And if the price of change looks a bit high right now, and you cannot raise the wind for some investment, a bit of greenwashing will persuade the customers to continue to come to you.

There are a number of things reported today that fit the brief of this blog. But most do not require much commentary. I have already updated the recent post on truckers as another crackdown, this time in Vancouver, reveals more neglect and danger to us all.

Carol James has an opinion piece on the carbon tax.

there’s a right way and a wrong way to price carbon. The right way is to listen to the people affected, address their concerns and take action. The wrong way is to work in secrecy, ride roughshod over concerns, and lash out when people dare to complain.

But that’s what they do on everything else. The one exception appeared to be health. (And by the way have you tried to watch tv news at 6pm here lately? The CBC is of course given over to hockey, and Campbell is all over Global and their fund raising drive for Children’s hospital. I am quite sure there are some advanced western countries that manage to build an adequate hospital system without resorting to fund raising telethons.)

Kevin Falcon thinks he cannot tell BC Ferries to roll back the huge pay increase for their Board members. Vaughan Palmer disagrees

Spirit of Vancouver Island Active Pass BC 2007.09.09 07:55

Ecodensity is going to get affordable housing added. Well they had better get a move on as the landlords in Vancouver seem to be intent on pulling the same trick that worked so well in Richmond. (A long running story in our local press last year was of an apartment building on Gilbert Road, opposite the hospital, where tenants were evicted and harassed for the same purpose, and there were several successful appeals to the provincial regulator. So far as I can tell these local freebies don’t have on line archives)

A one bedroom apartment in this condo building on West 4th listed yesterday for over $450k. A good example of higher density mixed use development but not exactly affordable. But the coffee is really good in Cornerstone: regular cappuccino $3

And Translink police are going to be added to the Taser enquiry. Of course: they are armed now, and they use their arms, so it is absolutely proper that they be made accountable for their use. The copper they use as a PR flack did not handle this one well. Or at all.

UPDATE 2:06PM There is a much better account in the Globe and Mail

and (4:20pm) more criticism on CBC

John Bird and John Fortune have been doing these dialogues for years on tv and radio in Britain. They follow a very strict formula. They quote accurately from published sources and only speak the truth. None of what you hear is in any way an exaggeration for effect. As with all good performances, they actually tone it down from what you would hear if you spoke to a real merchant banker.