World Coal Consumption

Investment Analysis Clubs Macro Economic Trends and Risks
22

I will be amazed if they (China) actually build all of those (Massive Coal plants), and a little surprised if they build any of them.
flyer boys

Hope springs eternal

23

@waterfell There are major frictional problems in China. The rationing of energy in many places in China has left the government with an obvious need for coal plants. That does not mean economically many of the new plants will make sense. There are too many problems, water, coal production, money, etc etc…and the wrong factories making the wrong products for all of this to work out well. Just like ghost cities ghost energy plants can end up empty or not working.

More likely China builds them and they are totally impractical.

24

Let me try to steelman this argument. What you seem to be saying is that renewable energy is expensive, so countries with strong renewable energy policies have seen their manufacturing move to places like China, where coal-based energy is cheaper. Essentially just moving emissions from here to there. Hence this transfer of emissions is indicator of the obvious failure of renewable energy policies.

Similarly, California has strong renewable energy policies, which have made energy expensive, therefore manufacturers are fleeing to lower energy cost states that rely on cheaper dirty energy. Germany is experiencing the same problem, again indicating the obvious failure (as you put it) of renewable energy policies.

But there doesn’t seem to be enough information to support those conclusions. Germany and France have roughly similar populations (France is a little smaller) yet Germany completely crushes France when it comes to exports. In fact, Germany is the third largest exporting country in the world. Germany crushes almost everybody when it comes to exporting manufactured products. Germany is the poster child for a successful export economy.

If, as you seem to be suggesting, energy policy is a big driver of exports, then every country should emulate exactly what Germany is doing, because Germany is the LeBron James of exporting manufactured goods.

From your second link:

In all, 153 California corporations relocated in 2021, which was double the number from a year earlier. The top five states the companies relocated to are Texas, Tennessee, Nevada, Florida and Arizona…

…Toney Sebra, a California native, is now part of the state exodus.

“So we opted for Utah, for a number of reasons, you know, very business-friendly state,” Sebra said.

Electricity prices paid by industry, year-to-date.
California: 18.51 cents per kwh
US Average: 8.08 cents per kwh

Steelmanning again. The implication here seems to be that California’s renewable energy policies have made electricity expensive, and therefore those policies are causing companies–and associated emissions–to relocate to Texas, which tracks with your “obvious” failure conclusion.

But it doesn’t actually track. Texas produces far more non-hydro renewable energy than California and it isn’t close. Texas absolutely crushes California in that regard.

Here is your table with Texas included:

Electricity prices paid by industry, year-to-date.
California: 18.51 cents per kwh
Texas: 6.46 cents per kwh
US Average: 8.08 cents per kwh

So the undisputed renewable energy leader Texas also has cheap power. That doesn’t seem to support your thesis that manufacturers to flee due to high renewable energy costs. If anything, they seem to be moving towards areas with lots of renewable energy.

I’ll also include an anecdote that I’m familiar with. At one time, Washington State was a major global aluminum producer due to cheap hydro power from the Columbia basin. The cheap hydro power is still there, especially from public utility districts who own their own dams that were paid off decades ago. But the aluminum manufacturing has largely moved to Russia and China. So if you have literally some of the cheapest, if not the cheapest, power in the US and yet the manufacturing still moved overseas…I think you have to conclude the power input isn’t the biggest driver.

And circling back around to your second article, it mentions California businessman Toney Sebra beat feet to Utah from California. That is an unusual name with an unusual spelling, so shouldn’t be too hard to track down. Google tells me a person with the same name is a reverse mortgage broker in West Jordan, Utah.

Do we really think there is a problem where mortgage brokers are being driven out of state because their electric bills are too high? I think this is one of those articles where there is vastly less than meets the eye.

If you look at the median income to cost of housing ratio, you find plenty of explanation for the reverse mortgage broker exodus. Hint: Housing is a lot cheaper in Utah than California. Renewable energy policy probably not the explanation in this case.

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25

It is the dumbie at the bar crying in his beer argument, “taxes are too high”. First go out and make a living dumbie. You do not pay taxes till then.

How many companies are incorporated in California?

Literally, millions of companies have chosen to start up in California and the state’s workforce continues to bounce back and grow . California is home to over 4 million businesses, from the corner mom-and-pop shop to the global corporation employing hundreds of thousands of people.Mar 16, 2023

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26

I’ll take your word for it, but I don’t think it is relevant. Yes, they have similar populations and both are western European countries, but their cultures are definitely not the same. I could go into a somewhat long story about how the Germans and French went to war against each other every few decades from 1805 to 1945. (There were plenty of military conflicts before 1805, if we want to get into the details). Their cultures are definitely not the same. Let’s just say that Mercedes-Benz, BMW, Audi and Volkswagen are somewhat different companies than Renault, Peugeot, and Citroen.

In my previous post, I included a link to a CNBC article about how energy prices are making it difficult for industries to remain in Germany. If you have other information, that’s fine.

  • Pete
1 Like
27

Of course, I made no such claim. That’s a red herring argument.

I was simply responding to your claim here:

Failure how? Your response was there are some rumbling that companies might leave Germany someday and that mortgage brokers are leaving California.

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28

Thanks for joining me in the murky waters of emission scenarios. Yes, the RCP scenarios include all greenhouse gasses plus a ton of other stuff. Sometimes the entirety of greenhouse gases are lumped together and called CO2 equivalent.

I estimated where we are compared to RCP 8.5 using figure 6 from The representative concentration pathways: an overview | Climatic Change. The figure has graphs for CO2, CH4, and N2. Elsewhere in the article they do talk about CO2 equivalent, but the figure and caption indicate they are showing CO2, not CO2 equivalent.

The estimate of 2022 global CO2 emissions being 10 GtC is from ESSD - Global Carbon Budget 2022. This also seems to be CO2, not CO2 equivalent.

So I think I am comparing apples to apples when I conclude that the 2022 CO2 emissions in the RCP 8.5 scenario is about 30% higher than the actual emissions.

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29

A few companies moving their headquarters out of California does not equal moving their production out of California. Chevron is still in California. Tesla still has production in Fremont and Lathrup California and is planning on other facilities in California. Other large companies in California: Apple, Microsoft, Google, Nvidia, Meta, Broadcom, Oracle, Cisco, Salesforce, Netflix, AMD, Intel, Walt Disney, Wells Fargo, Amgen, Intuit, QUALCOMM, Applied Materials, Gilead Sciences, Charles Schwab, Uber, Palo Alto Networks, Airbnb, and many others like with large facilities like Mitsubishi and Solectron Corp. I am not worried about California losing any business!!!

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30

syke6,
You made an excellent post - shooting down waterfell’s bogus claims about renewable energy in Germany, California. and Texas.

Waterfell still thinks that the residential price of electricity shows that renewables are not cheap. I have tried several times to correct his erroneous posts. Waterfell does not understand that wholesale price of electricity is what provides the information about the true cost of electricity provided by renewables, nuclear and fossil fuels. Residential prices are loaded up with taxes in Germany and California which distorts their true cheap prices. The same applies to gasoline and diesel prices in California. Living in a low tax state like Texas means low price electricity and gasoline. Sort of like living in luxury of CA costs more than living in the slums. of TX.

I wonder when will Waterfell leave beautiful Southern California coast for Texas.

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31

And those high residential prices are what the homeowners and consumers pay. Perhaps those taxes go to pay for the renewable subsides.

DB2

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32

Retail or residential prices are made up of many factors:

Retail price = Wholesale price + cost of transmission & distribution + cost of engineering & administration + taxes

Electricity prices vary by type of customer

Retail electricity prices are usually highest for residential and commercial consumers because it costs more to distribute electricity to them. Industrial consumers use more electricity and can receive it at higher voltages, so supplying electricity to these customers is more efficient and less expensive. The retail price of electricity to industrial customers is generally close to the wholesale price of electricity.

In 2022, the U.S. annual average retail price of electricity was about 12.49¢ per kilowatthour (kWh).

  • The annual average retail electricity prices by major types of utility customers in 2022 were:
  • Residential15.12¢per kWh
  • Commercial12.55¢per kWh
  • Industrial8.45¢per kWh
  • Transportation11.66¢per kWh

Electricity prices vary by locality

Electricity prices vary by locality based on the availability of power plants and fuels, local fuel costs, and pricing regulations. In 2022, the annual average retail electricity price for all types of electric utility customers ranged from 39.85¢ per kWh in Hawaii to 8.24¢ per kWh in Wyoming. Prices in Hawaii are high relative to other states mainly because most of its electricity is generated with petroleum fuels that must be imported into the state.

33

California also has quite high commercial electricity rates, only marginally lower than residential and more than double the national average. From the EIA, August 2023, average costs (cents per kWh):

             Calif  National   Ratio
Residential  29.8     15.9     1.87
Commercial   28.1     13.3     2.11

DB2

34

Yeah. If only they had access to sun or wind, or maybe even both! Ah well, too bad, perhaps they’ll think of something else to help.

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35

Well, they have been working on it. An interesting case study of the [lack of] ease in switching from reliables to renewables.

DB2

36

No, that is not the way I put it. The “obvious failure” phrase I made was in a completely different post than the one you replied to about German and California energy policies.

FWIW, the “obvious failure” that I was referring to was the overall approach for slowing or stopping the rising atmospheric CO2 concentration.

I’m old enough to remember when the Kyoto Protocol was agreed to in late 1997. That was supposedly when the world started taking global warming seriously, and we were going to start slowing the rise of CO2. In 1998, the average atmospheric CO2 concentration at Mauna Loa was 367 ppm. That year, global CO2 emissions from energy and industry was 24 billion tonnes.

Fast forward to 2022, and the CO2 concentration was 418 ppm, and the world emitted 36 billion tonnes of CO2. World CO2 emissions have gone up 50% since the historic Kyoto Protocol, and the atmospheric concentration is still rising. In fact, it is rising at a faster rate now.

Today, people think the 2015 Paris Agreement is going to put the world on the right path. Think again.

  • Pete
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37

A small point, but the link you provided says 10 GtC is just from fossil fuels (Efos). If land-use CO2 is included, it is more like 11 GtC.

The following link from the Global Carbon Project says the same thing.

The new report projects total global CO2 emissions of 40.6 billion tonnes (GtCO2) in 2022. This is fuelled by fossil CO2 emissions which are projected to rise 1.0% compared to 2021, reaching 36.6 GtCO2 – slightly above the 2019 pre-COVID-19 levels*. Emissions from land-use change (such as deforestation) are projected to be 3.9 GtCO2 in 2022.

40.6 GtCO2 x (12/44) = 11 GtC

But the COVID crisis probably had a larger impact on which RCP scenario we were recently on.

  • Pete
38

Hawaii has been a leader in solar power for years, but recently the state has made some changes that have impacted the solar industry. In this blog post, we’re going to explore the reasons why Hawaii stopped net metering and what this means for the future of solar in the state. We’ll look at the solar panel market in Hawaii and discuss the incentives that have been phased out over the last few years. We’ll also touch on Hawaii’s growing self-sufficiency with solar power and how that’s impacting the solar industry. Finally, we’ll wrap up the post with a look at how solar power is becoming more popular in Hawaii and what this means for the future of solar in the state.

https://haleakalasolar.com/why-did-hawaii-stop-net-metering/#:~:text=The%20cost%20of%20solar%20power,extra%20power%20their%20panels%20generate.

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The state now offers homeowners on Oahu — home to 70% of its population — incentives to install home batteries with their rooftop solar systems. Utility companies can tap those batteries for power between 6 and 8:30 p.m., when energy demand typically peaks, which gives them some control over when electricity from rooftop solar systems flow back into the grid. Without battery storage, they have no such control. “It’s a good example of a good policy pivot with utilities and regulators saying, ‘We need to change how we approach this,’” said Bryan White, a senior analyst at Wood Mackenzie.

In the past, Hawai’i got 80% of its electricity from oil. That’s now down to 66%, but it’s still way too high to meet the state’s carbon reduction goals. “Dependence on oil is the wrong path,” James Griffin, chair of the Hawaii Public Utilities Commission, tells the New York Times. He has dedicated himself to reducing tensions between utilities and the rooftop solar industry.

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