Sep 14th 2011, 2:26:59
The article is thought provoking, in some cases spot on but in many cases incorrect. The problem comes from lacking a lot of checks and balances on simple estimations, due to which I think that a lot of things are unsubstantiated and in my view wishful thinking. Thereby a specific view on what is the case is imposed on the reader who doesn't read between the lines.
Specific problems that I have related to statements made are:
1) Statement: "A concentrated power source that can be stored allows social and political power to concentrate in the hands of those who control it. It generates very different social dynamics from an energy source that is universally distributed and constantly renewed. or one thing, the profit potential of the latter is intrinsically less. Once you have sold the geothermal pump or the PV array, the buyer is self-sufficient, unlike the electrical power consumer who has to pay the metered rate in perpetuity. Energy dependency and economic dependency are closely linked."
I agree with the outlined logic that a concentrated power source allows for higher social/political power, and that energy dependency and economic dependency are closely linked. However, the profit potential of a universally distributed (but centrally produced) power source is similar to that of a source where both the capital and fuel are centrally produced. It appears as if there is a large difference in terms of power when you have your own solar panel, but at an aggregate scale there is little difference. The difference is the time distribution for a single user in terms of spending.
Say that the cost of natural gas electricity and solar power are similar, and that a consumer chooses for solar power over natural gas. This implies that the consumer spends 95% of the cost at t=0, while otherwise the company would through fuel consumption get the same sum over a longer period of time. For the individual this would appear as if he/she is only dependent at one point in time. However, the company would still be able to reap the same profits (unless marginal costs/cost patterns are different), but the temporal distribution of those profits changes.
The only difference in profit potential that I can see derives from the change in terms of quality. In the present market a lot of profit potential comes in case of oil due to low cost producers (OPEC) being able to sell their oil at high prices as the costs of marginal demand are very high (80+ dollars per barrel). I.E. OPEC producers obtain a 40-60 dollar per barrel profit margin. This is less the case with solar/wind power as there is little difference in the cost pattern between producers. However, this is not intrinsic as it depends on technologies and resources, and in such a centralised case it is still possible to monopolize things.
The check and balance here comes from looking at things from a societal perspective (in which the firm that produces solar/wind power operates) instead of an individual perspective. The case laid out would be true if also the production of the technology would take place locally, but I don't see any argument towards this in the article (and doubt the feasibility of it).
2) Statement: "For example, thanks in large part to the Internet, a tide of decentralization and disintermediation is erasing the producer/consumer divide in the areas of news and entertainment. That more and more of our time is spent watching "content" produced by amateurs suggests that we are approaching "peak Hollywood," in parallel with peak healthcare, peak pollution, peak advertising, peak fisheries, and peak oil. '
The claim made here is not substantiated, at the surface it may appear as if some decentralization has taken place but as far as I can check centralization still rules the day. We need specialization to keep a complex society as this one running (whether that is a good thing is a different discussion). In terms of hollywood/entertainment The "model" has changed slightly in the selection of people as a few talents are now selected to "stardom" via internet websites, but this is actually an enforcement of the centralized model as these go into the same system as before.
3) Statement "For decades or centuries, we have maintained growth first by meeting needs, then by creating new needs, then by bringing non-monetized cultures and non-monetized domains of our lives into the money domain. Community, for example, can be stripmined just as coal can: turn the functions of story-telling, dispute resolution, child care, elderly care, recreation, entertainment, into paid services. But in either case, material or social, this process is reaching its limit. We are indeed entering a time of Peak Everything."
It is claimed here as if growth is maintained by meeting needs, creating new needs and brining non-monetized cultures and non-monetized domains into the money domain. This is difficult to defend as economic growth itself is maintained by extraction and developing resources together with technology which can facilitate the services. Any services can also be brought into a monetary system which does not depend on growth, this is a different issue altogether whether or not that is a good thing or not. I find the conflagration of these issues problematic.
4) Statement: "The difficulty in finding a substitute for oil, for example, is born of economics. Imagine what we could have accomplished if the millions of scientific careers and hundreds of billions of dollars that have been devoted to petroleum and nuclear power over the last fifty years had gone instead into developing "alternative" energy technologies. Imagine if, at the dawn of the environmental movement in the 1960s, we had launched a global scientific effort exceeding that devoted to the space race to create a pollution-free society. It did not happen, and with good reason: there was no money in it (given the kind of money system we have had). Compared to the technologies of Big Energy, there is little profit to be made in the alternatives. The alternatives are not conducive to economic growth, and will never flourish in a money system that compels and depends on growth."
The cause of finding a substitute for oil is put here entirely on the monetary system which we have in place today. Although true there is much more too it, as this is also very much related to humanity itself (and our discount rates) as well as technological differences. There is no look at a metric of welfare (doubtful if the same level could have been sustained with alternatives).
5) Statement: "Sunlight, wind, conservation, geothermal energy, and more controversial technologies like cold fusion, Bedini/Bearden devices, and so forth share an important characteristic in common. Their energy source is more or less ubiquitous, so that users needn't be dependent on an ongoing supply of scarce fuel. They are, in an important sense, abundant. his feature puts them at odds with our money system, which depends on the creation and maintenance of scarcity. To profit from something, say energy, it must be scarce: high-tech pharmaceuticals, for example, rather than ubiquitous weeds and folk medicine. "
To profit from something you need to have a property rights system in place, and have something that people demand, scarcity or abundance is not a relevant metric in this sense. In case of fossil fuels these are abundantly available in today's society because of their low cost. The technologies to covert sunlight and wind and geothermal etc. are not abundantly available (supply is often overbooked by demand and delays in delivery are frequent) because of their high cost, their relative scarcity is high.
The example of high-tech pharmaceuticals versus ubiquitous weeds/folk medicine is difficult as this also involves an aspect of quality, reliability, and the impossibility of mass production. It is an interesting example but difficult to compare with energy.
Etc.
Nobody puts baby in a corner
