Jay's Blog
Best Sources of Energy Information
Amid the torrent of energy writing coming from vested interests and the frequent inaccuracies in seemingly reputable sources, I am often asked where people can go for trustworthy information on energy. Here are a few suggestions.
The Department of Energy's Energy Information Administration at http://www.eia.doe.gov/ provides the foundation for all good work on energy. You can find definitions of terms plus weekly, monthly and annual data. You can also get EIA's short and long-term forecasts. Remember these forecasts are based on certain (fully disclosed) assumptions. Even the data are estimates. But EIA has no policy axe to grind, undertakes its work with great diligence, and offers a customer-oriented help desk if you can't find what you're looking for.
Fortunately, the United Nation's Intergovernmental Panel on Climate Change puts its major assessments on the web. Check out http://www.ipcc.ch/. I agree with some critics that the laborious way that the IPCC puts its studies together means they fall behind the curve in terms of the latest understanding. Still, these authoritative efforts provide a good point to launch a careful discussion on climate change.
The Environmental Protection Agency suffered from the political influence of the Bush appointees, but continued to put highly credible information on its web site. I like, for instance, the detailed annual ratings on auto fuel efficiency, which can be accessed via http://www.fueleconomy.gov/feg/FEG2000.htm.
There are many good think tanks on energy, but two stand out for basing their conclusions on solid evidence and analysis. Resources for the Future at http://www.rff.org/Pages/default.aspx has been around for a long time. RFF looks at energy and environmental issues from an economist's point of view. Duke University's Center for Global Change at http://www.nicholas.duke.edu/cgc/ is much newer (and actually housed in the same building as RFF), but is putting out some terrific analysis. (In full disclosure, my graduate degrees are from Duke many years ago.)
Likewise, there are many good independent web sites that try to stay abreast of major developments in energy. I like American Energy Independence at http://www.americanenergyindependence.com/. Site creator Ron Bengtson lives in Boise, Idaho. Maybe his distance from the Washington allows him to transcend the well financed hype that tends to influence our nation's capital.
In a later blog, I will comment about press coverage of energy and recommended books.
Climate Change and Tax Incentives
After the 2008 elections, there appears to be sufficient agreement in Washington on the science of climate change that we are likely to do something about it. The danger now is doing things that are politically popular and make us feel good rather than things that are actually effective. That is why we should remain skeptical of proposals that put much emphasis on tax incentives and government loans as solutions to the problem of global warming. As I mentioned in the Green Inc. blog at the New York Times recently (see http://greeninc.blogs.nytimes.com/2009/01/21/fixing-the-tax-problems-of-renewable-energy/) tax incentives are less effective than several other measures for promoting alternative fuels, although they are the ones that get the most support from alternative fuel lobbyists.
One reason that tax incentives have not been effective in the past and unlikely to be so in the future is their uncertain duration. An incentive over just a few years is likely to reward people who were going to act any way (sometimes called “free riders”) rather than form a basis for long-term investment. Advocates say we should just make the incentives permanent. However, a long-term incentive that brings a new fuel to successful market penetration creates a permanent subsidy that is unsustainable from a budgetary point of view. (Tax breaks for unsuccessful programs are much easier to fund.)
Energy history is strewn with government loans program for project that went bust because of the volatility of energy prices. This illustrates a more general problem that the government can invest money in tax incentives or loans and end up with very little to show for it. This problem is acerbated by the complexity of the tax code that permits some people to manipulate the code for purposes unrelated to the intent of the provisions and other people who are doing the right things to not qualify.
The basic principles for combating global warming are the same as they have been for other major environmental issues. Either polluters have to pay for the damage they cause or they have to be told that certain levels of pollution are simply not allowed.