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Saturday, February 11, 2012

Energy Production's Direct Correlation With National Wealth - part III

   So if promoting energy production promotes growth but government redirection of of economic resources is normally a very inefficient way of running an economy how do we go about it.

   The early USSR is an example of doing it no holds barred. Stalin simply confiscated the peasants grain and sold it abroad to buy machine tools, generators etc etc. Now in its way that was successful, in that they did build a growing economy, but it also meant several million peasants starving to death. I think a market orientated approach can achieve the growth without the deaths. I think a market orientated approach would have worked better in the USSR at the time but that wasn't an option because the USSR, being poverty struck and coming out of a civil war, had no spare money to invest; because of western anti-communism wasn't able to borrow internationally; because of Soviet anti-capitalism, wasn't willing to allow investment either by foreigners or natives; and because they had grabbed the assets of both foreigners and natives nobody was going to be silly enough to invest there no matter how good the opportunities. The state having destroyed all other options had to do it itself.

   Fortunately none of this applies to us today (well ok there are some politicians ideologically opposed to sanity). There is no shortage of money in the world economy available for commercial investments. Companies are bulging with money. It is simply a shortage of such investment opportunities, at least in the slow growing Luddite economies of the EU and USA. So my proposals involve working with market incentives rather than against them.

   Even better, from our point of view, is the fact that there is a method of greatly reducing the cost of electricity production and producing it in far greater quantity without any technological breakthrough. That method is reducing the regulatory burden on nuclear power, which makes up most of its cost, and allowing/encouraging the mass production of reactors. It seems certain that wholesale electricity prices in Britain could be reduced by 93% by doing this. Since ours is some of the most expensive electricity in the world the effect elsewhere might be as low as only cutting 75%.

   So what should we do to bring this about.

1 - Set a target. I have previously given the calculations that showed a maximum theoretical sustainable growth rate of 23.8%. To achieve that would obviously require a minimum of that rate of increase in energy usage. In practice one would want more than that and suggest we should be prepared to support a growth rate 1 1/2 times that ie 35%.

   We use an average of 40GW per hour  Call it 50 to cover normal variation.

   So we should be wanting to produce 67.5 (increase of 17.5%) after 1 year.; 90 ((inc 22.5) after 2; 120 (30 inc) in the 3rd; 160GW (inc 40) in the 4th; 215 (55 up) in the 5th; 290GW (75 up) in the 6th; and 390GW (100 up) in the 7th.

  In fact, since it takes some time to build reactors I assume we would not get those increases in the first 3 years. However if a mass production reactor factory is involved able to turn out 100 Gigawatt reactors a year, at a flat rate, the production in years 3,4 & 5 should sufficiently exceed the target to catch up.

  However simply ending the subsidy of windmills would reduce prices immediately and investors, knowing that the increased supply/reduced prices were online, would start investing and growing the economy immediately.

   Up till now the normal assumption has been that it takes 3 years to build a new reactor so with building a factory mass producing them one would expect somewhat longer. However there are 2 alternatives. Firstly an X_prize for early completion and secondly the new Westinghouse SMR which is 1/4 GW but designed for mass production & easy delivery within 18 months - it is 1/4 the size but takes up only just over 1/4 the space of a traditional reactor, 1/4 the cost and presumably could be mass produced 4 times as fast.

   With mass produced reactors costing £800 million per GW retail I would expect such a factory, producing 100 GW a year , would cost not more than £200 billion - I'm assuming Westinghouse are expecting  that of the £80 billion they will make a year in turnover, 1/2 will be marginal profit giving them a 20% return on capital - highly profitable but by no means outstanding for a new product. A massive investment indeed but at 4% of GDP, not much to get an economy growing at 24%. In fact it would be in national surplus in a year if we only got it growing at 4.1%.

    It is also close to what the government insist they want to spend on windmills, for no obvious beneficial effect, so clearly they think we can afford.

   That is assuming government has decided they want the ownership and long term profits of the business If government decided it was happy to keep only about 20|% of ownership it could arrange this simply by providing Westinghouse with land, instant planning permission, the end of all unnecessary regulations, ministerial support in negotiating international loans, a guarantee to support purchasers in adding the power to the grid and a holiday on VAT & other taxes for the first 3 years. This would obviously cost virtually nothing since not collecting taxes on an industry which is currently not intended to be allowed to exist, is not a cost.

    I suspect the optimum would be somewhere between government paying the lot and owning it all and government paying nothing and owning 20%.

  A few other ideas which are less hands on:

  • Planning permission to be decided for any power project in a matter of days and to go through unless they are very strong reasons against.
  • Tax holidays or rebates for the entire industry so long as it isn't growing faster than the target rate.
  • A state guarantee a minimum purchase price for up to the target amount of electricity which they then resell at whatever price the market will bear. This could be expensive if demand is seriously overestimated but it does greatly reduce the business risks of  investing in such expansion. (this idea is derived from a similar proposal for orbital launch cargoes and was used by me in a proposal to encourage the modular housebuilding industry.
  • Strong programme of cutting unnecessary nuclear regulations.
  • A constitutional right to demand the suspension of any regulation that imposes a heavier cost/safety ratio on one industry than comparable regulations in another. Again something previously advocated. With 5 people having died in Britain from windmills in the last 5 years and only 2, because of reactors, anywhere in the world, over the last 20, while nuclear produces orders of magnitude more power, it cannot honestly be argued that we have a level regulatory field.
  • Government providing loans at the normal government borrowing rate.
  • An X-Prize for the completion of the first new reactor. Smaller ones for 2nd & so on.
  • Improving the national grid so that it can handle as much new power as wanted.
  • X-Prize for the first commercial thorium reactor. This is based on what the Saltire prize is supposed to be doing for sea-turbines.
  • Building links for an International Grid based on high voltage DC current (HVDC). Once such links are in place we have an export market ready to hand. One of the few things government appears to be able to do cost effectively is to improve transport infrastructure and since facilitating transport of electricity, while technically entirely different, follows the same economic arguments as those for facilitating the transport of lorries, this is something government can properly do.
And a number of X-Prize proposals to encourage other methods of power production not involving nuclear electricity. They may not be immediately competitive but good research always pays off, even in unexpected ways.
  • Algal oil. The potential for producing oil grown from algae is virtually unlimited if done from mid ocean plants using nutrient heavy water from the ocean depths. Substantial prizes for early successes in developing this should work.
  • The Saltire prize. I don't think it will work because i don't think ocean energy i has the necessary energy density to ever be competitive. But if the prize is properly run it will do no harm and might even prove me wrong. If it doesn't no prize is awarded. This is only part of the "renewable" industry that might prove worthwhile
  • X-Prize for improved efficiency of solar power. Solar power units are dropping fast in price along with other electronic goods. At some stage, possibly quite soon, they may become cheaper than the electricity we now use. Of course our current prices are far above what they could be.
  • X-Prizes for developments in the field of "conventional" fusion
  • X-prizes for development in the field of low energy nuclear reactions (LENR) the more respectable & more accurate name for cold fusion.
  • X-prizes for development of solar power satellites.
  • Funding nuclear pulse launches - anything that can put 10,000 tons in orbit cheaply in one go can quickly fill the sky with solar power satellites .
  Over decades (or millenia if NASA and ESA do it) solar power satellites can produce more power than we can ever want. The radius of geosynchronous orbit is about 8 times the radius of the Earth. That means that the total energy available is 8^2 at least doubled to cover the light stopped by our atmosphere ie 120) times all the sunlight that reaches the planet's surface. SPS also have the advantage of being unaffected by weather and having few if any moving parts and can thus keep delivering power at around zero cost for at least millenia without repair.

   When energy is available in those quantities it will no longer be a limiting factor in growth. Perhaps something else will be. Perhaps wealth will cease to be an issue when we all have everything wealth can supply.

   And if demonstrating that, here and in part 1 and part 2 doesn't get me a Nobel in Economics nothing will ;-)

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Thursday, February 09, 2012

Energy Production's Direct Correlation With National Wealth part II

    Yesterday, in Part I of this, I discussed a particular paper showing the very close correlation between growth inn energy use, particularly electrical, and in GDP in America.

    However science requires results to be repeatable, particularly difficult with economics. But here are 5 separate examples:

1 - The original - that from 1900 to 1975 American energy use and GDP rose in almost precise lockstep.

2 - The original variant - that after 1975 GDP rose faster than energy use, at a time when energy production was being artificially restrained by the authority of an increasingly anti-technology government. I have previously described how, had political authority not been restraining the building of nuclear power plants and the previous trend continued we would have roughly 2.4 times more electrical capacity than we do. Note that though American growth was faster post 1975 than electricity production it was slower than it had been in the 1950s and 1960s.

3 - China's growth has been almost exactly 10% on average since 1980. As the graph under shows electricity production went up from 240 TWH to 2400 TWH between 1980 and 2005 - a rate of 9.64% annually. That correlation over that period of time is remarkable by any standards. China during this period has become a distinctly free market economy, unforced or restrained by overgovernment.
File:Electricity production in China.PNG

4 - From 1927 - 37 the Soviet electricity supply grew at an eye watering rate of 23% annually. The economy grew at a rate of around 10% annually, a level at that time almost unheard of in the world. It may be that other energy sources grew less fast but I suspect that the main reasons the economy did not reach 23% annually are the inherent inefficiencies of a command economy, even a newly formed command economy where the bureaucracy is not yet deeply entrenched, and that 23% was an even more astonishingly high target then, when basic technology was not growing as fast as it is today. This is therefore an example of government artificially pushing up the natural market rate of power production (at a horrifying cost in famine) and, again, the GDP growth rate following the power supply rate but not matching 100%.

5 - Tim Worstal not only making a case that electricity use worldwide, as shown by electric light emitted, very closely correlates with GDP but says that it does so better than official, GDP figures do. Not really possible to get a much better correlation than that

   That evidence being accepted,  the conclusion seems inevitable

   That in a free market there is an almost exact correlation between energy use and in particular electricity use (it being the most flexible and high entropy supply of energy yet developed and thus the most useful).

   That government can greatly promote or restrain GDP by promoting or restraining the power supply. This does not exercise a complete one to one correlation, but it does work far more effectively, in both directions, than than the fiscal or even entrepreneurial encouragements or restraints it controls. This is exactly what we would expect if power production is not the sole vehicle of growth but is the predominant one, probably producing around half the total cause of growth. Thus the Soviet economy grew at just under half the rate of electricity growth (probably over half the rate of total power growth)  while, until the last few years the British economy has managed some growth, in good years 2.5% or half the world average, while electricity supply was actually being made to slightly fall.

    And so to part III.

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Wednesday, February 08, 2012

Energy Production's Direct Correlation With National Wealth part I

   OK here is a pdf on the complete correlation in America between energy production and GDP from 1900 (before which we don't exactly have a big electricity industry) and 1970 (after which "environmental" regulation severely and artificially depressed power production.

   In economics, being at least as much art as science, let alone engineering, you simply do not expect to find such mathematically precise relationships. From page 20/21
Summary and conclusions

In the `standard’ model a forecast of GDP requires a forecast of labor L, capital stock K and the Solow multiplier – multifactor productivity or technical progress — A(t). We have shown that introducing energy and/or material resource (i.e. exergy) inputs does not significantly improve the explanatory power of traditional production functions. A time-dependent Solow-multiplier is still needed.

However a much better explanation of past economic growth can be obtained by
introducing exergy services (useful work) as a factor of production, in place of exergy inputs.
Exergy services can be equated to exergy inputs multiplied by an overall conversion efficiency
which, of course, corresponds to cumulative technological improvements over time. Based on
this hypothesis economic growth from 1900 to 1975 or so is explained almost perfectly, except for wartime perturbations.
   It then goes on to suggest that the rate of energy production has been less than that of overall growth since about 1975 and suggests that this may be because of improved efficiency or of the oil crisis in 1974 raising prices. Of course if the underlying cause of the diversion of effort to increased efficiency and the underlying cause of oil price hikes (though oil prices have varied widely in the interim and have at times been in real terms significantly lower than in the 1960s) is shortage of energy this would also explain it.

    The question then becomes whether the shortage of energy is because we are hitting peak oil/coal/gas/uranium/thorium/solar power satellite power/cold fusion etc. or whether it is because of political limitations on developing some or even all of these. Looking at that list in full it is obvious that there is no possibility of hitting peaks in some of them ( shale gas, nuclear SPS)  and that in all the others the reserves are still increasing so the limits on energy production and thus national wealth can only be purely political.

    Part II and part III to follow.

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Tuesday, February 07, 2012

Things You Can't Say In The British Media - Freedom of Speech is a Good Thing & Applies Even to People that The Nomenklatura Dislike Such as the SDL

  This is a letter out to the entire Scottish press. It has not been published. I will, of course, acknowledge if it does get used but am fairly confident they will all live down to my expectastion of censorship.

With Ruth Davidson joining the call for banning the SDL demo how glad we must all be that we live in a country where the leaders of all factions of the ruling party are in agreement about preventing our little minds being warped by this dreadful freedom of speech thing. I have no idea what the SDL actually stand for and since whatever it is won't get reported by any part of the mainstream media and (most unusually in any country west of China) even their website is unavailable, I am being protected from knowing.
However with leaders of all 5 parties in Holyrood combining to say they should not be allowed to express those opinions in a public demonstration, to preserve the innocence and purity of the Scottish people's minds, we do at least know what they stand for.
Apart from proclaiming catastrophic global warming, supporting criminal wars, the world's most expensive 'climate change" regulation & consequent ever higher electricity bills and more recession & getting us to pay 8 times as much for a useless new Forth Bridge than the last one cost, in real terms, that is.
We must be grateful that the old-fashioned chaos of the principles of the Scottish Enlightenment are so alien to the minds of the censors in Holyrood as they labour for the greater good of a free & democratic society so mericfully free from the ravages of differing opinions.
 This is the news item in question.
The Scottish Defence League (SDL) has applied to hold a public procession through Glasgow's streets on February 25.
The group has been branded "neo-Nazis masquerading under the flag of Scotland".
An open letter by SNP MSP Humza Yousaf calling on Glasgow City Council to refuse permission for the march has been signed by cross-party MSPs including Deputy First Minister Nicola Sturgeon, Labour leader Johann Lamont, Conservative leader Ruth Davidson, Liberal Democrat leader Willie Rennie and Green co-convener Patrick Harvie.
Other signatories are human rights lawyer Aamer Anwar, Church of Scotland church and society council convener Reverend Iain Galloway, Dr Salah Beltagui of the Muslim Council of Scotland and the Scottish Council of Jewish Communities
The open letter is also backed by the STUC and trade unions Unison, Unite Scotland, PCS, FDA and CWU.
Mr Yousaf said: "I am a firm believer in free speech, regardless of how unsavoury it may be. However, it is imperative freedom of speech is not at the expense of public safety.
"The SDL must not be given free rein on our streets to peddle their toxic hatred.
    You cannot be a believer in free speech and an opponent of it at the same time. Even those who support fascism should disapprove of lying fascist hypocrits like the SNP's Yousaf. Whatever arguments there may be for censorship there can be no argument for appointing a censor who proves himself to be personally wholly and completely devoid of any trace of personal  honesty. Clearly all those honest politicians and newspapers in Scotland who have any trace of the principles of Scottish enlightenment will publicly concur.

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Monday, February 06, 2012

The BBC Reports Russia Undemocratic Because Their Media Are Biased

  Over the last few months we have had a lot of propaganda from our state broadcasters and "journalist" flacks about how Putin must have fixed the Russian election to win.

   My personal opinion is that the Russians vote for him because he has produced an economy growing at 7% annually. My further opinion is that at least an equally large majority would vote for a party in Britain that could credibly make the same offer if they were not going to be both prevented from hearing about it by media censors and disenfranchised by the electoral system.
  Lets see what Charles Crawford, Britian's former ambassador to NATO's various starapies in Yugolsavia, very loyal to to the FO line but nonetheless both intelligent and comparatively honest, has to say.

  "I played a modest part in the proceedings as an official international observer accredited to the elections under the auspices of the International Institute for Integration Studies, a Moscow-based grouping close to senior circles of power in Russia. The Institute supports various public conferences around the world, including the strange one I attended in Belgrade in June....
 In Nizhny Novgorod I was given excellent personal briefings by the Deputy Governor and the head of the local elections commission, who showed me one of the new electronic counting machines being used in a number of polling stations across the country....
International election observers have to try to do three things. They need to look at the rules-in-themselves to see whether they make sense and are reasonable and comprehensive. They need to look at how the rules are then applied to real life: are the procedures on paper being properly followed and interpreted? Finally, they need to look at the process as a whole and to see where it fits into the country's political life.
It cannot be said often enough. Russia is an unfathomably huge country with unique issues of command and control (and associated attitudes to governance) going back many centuries. Until the collapse of communism in 1991 there was no tradition of representative democracy. Setting up democratic institutions and practices (and, most important) creating democratic instincts had to be slow.
The arrangements laid down by Russia’s law for conducting elections are technically impressive, albeit detailed to the point of obsession. Russian procedures are better than ours here in the UK in at least three respects:
Votes are counted in the polling station concerned immediately after the polls close, in the presence of party and other observers (ballot boxes are not moved to central counting points with the risk of mischief en route)

No ID, no vote

No postal voting
Moreover, there are streamlined and well monitored arrangements for getting the election results sent fast to Moscow for central compilation. Amidst the complaints about Russia's elections, you don't hear the argument that the counting of the votes as cast has not been fair and accurate...
So what's the problem?
First, there inevitably are a large number of electoral violations of different shapes and sizes. When I wrote my book review for the LSE on Electronic Voting, I was struck at how we all take for granted the procedural complexity of voting. The following (and many more) are all essential:
voters lists compiled and kept up-to-date

secret voting

ballot boxes sealed throughout the process

accurate ballot papers printed and distributed under controlled conditions

identification for voters

meticulous and transparent counting, to make sure that all votes are counted and only votes properly cast have been counted

procedures for disputes as to what a messy mark on a given ballot paper might mean

arrangements for recording the final outcome and storing all ballot papers securely in case of future legal challenges.
At literally every stage of the process in any country there is scope for human error and/or deliberate mischief. Ruling out both 100% is impossible.
Thus we need to be careful in agreeing with those who allege “massive violations “of electoral procedures in Russia or anywhere else. If every polling station in Russia has only one complaint about some or other procedural violation, there will be 96,000 complaints! Massive violations! Yet many of those complaints (including two we heard: one party doing some campaigning on the “day of silence" before the elections and not printing its name on election materials) will have been trivial in themselves and quite irrelevant to the final outcome.
Some violations are deliberate and (as far as local conditions allow) systematic. One frequent claim again in Russia is that ‘captive’ voters in mental illness institutions and the Army were lent on hard to vote for the Putin party. (I used to see this in Britain where people from council run old folks homes were all delivered at once by "carers" who were clearly telling them who to vote for but now that we have postal votes it is much simpler - neil) Unofficial crowd-sourced election monitors Golos have put on the Web all sorts of other examples, some filmed as they happened.
Complicated official arrangements such as running a nationwide election work in good part because they are transparent. Yes, in formal terms Russia does all it needs to do to host international and political party observers. But this time round the blatant official and unofficial pressure put on Golos (including denial of service website attacks and the usual insinuations that foreign support for such organisations was illegitimate or sinister) created a very bad impression.
More generally the post-Communist ruling establishment in Russia has changed the law to make it harder for new political parties to make a breakthrough. (Note: UKIP has views on the subject here in the UK Charles' note not mine.) Smaller parties are not allowed to form a single voting bloc. The rules for forming a national party able to contest national elections are excessively strict and not easy to meet. An earlier, excellent option of including on the ballot paper a vote for “none of the above" has been withdrawn. And so on.
Add to all this the violence suffered by some journalists who try to expose official corruption, unrelenting pro-Putin media coverage and the way far too many Russian media outlets condemn or marginalise any liberal views, and you get the sort of outcome which the OSCE fairly criticises. (would that our media were willing to expose official corruption like the Forth bridge costing 8 times what it should  or the Muir Russell scandal they censor any mention of; would also that our state controlled "balanced" media did not deliberately censor or marginalise any UKIP or other free market opinions - Neil)
Just look at the results. Four parties have made it into the national parliament, after roughly half the Russian population voted:...
Parties representing a more liberal policy-set involving reduced state control and better human rights either did not get into the race or (as in the case of Yavlinsky's Yabloko party) failed dismally once again. A new supposedly centre-right party Right Cause won only 400,000 votes.
Western commentators and some in Russia are claiming these election results show rising dissatisfaction with the performance of Vladimir Putin. They might even be right. But that dissatisfaction is rising from a low and apathetic base, and insofar as it translates into changed voting it boosts tendencies which are even worse. Compared with the other three national/socialist parties which crossed the threshold to enter the Duma, Putin's party look almost normal. Putin remains the favourite to be voted back in as Russia's president in the forthcoming elections next March....
Under current management Russia is getting steadily more prosperous and steadily more pluralistic, albeit in a specific Russian way. Russians en masse have a (for us) startling capacity for putting up with hardships, including overbearing and neurotic state power. They are not bothered by their leaders sneering at foreigners or homosexuals or liberal attitudes. They do want to see progress and get richer, and they hate corruption and get-rich-quick types....
Yet in Russia as in so many other countries the mass of people are getting more powerful vis-a-vis the state. Perhaps the main story of these elections is the way many Russians are now using cheap mobile technology to follow and record what is happening across their vast country - and Vladimir Putin's so far uncertain response."
   For Charles' background it is obvious that though he is broadly honest his biases are towards the British government "pravda"* yet, even on each of the relatively limited criticisms he makes of Russian democracy it comes out ahead of our own current system.

    Of course you aren't going to see such honesty on the BBC or in any significant part of our MSM.

   Which, as the OSCE's position implies, says more about the fascist parasites running Britain than it ever could about Russia.

Perhaps the British media would be closer to honest and impartial if they were to give as much coverage to the hundreds of EDL protesters in Britain arrested on charges of doing nothing or of being victims of racial attack, than to the very small number of western funded actual Russian rioters arrested. But then one might be drawn to the conclusion that Russia is a much better democracy than Britain.
* "Pravda" means truth. However, since it was the name of the main Soviet newspaper, it came to mean "official truth" rather than actual truth. The state controlled British media largely consists of such pravda.

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Sunday, February 05, 2012


 7 Alternatives to EU membership:
1. Join Nafta
2. Join Efta
3. Join Efta and the EEA

4. Forge closer ties with the BRICS economies
5. Make more of the Commonwealth
6. Consider Socialist alternatives
7. Go a la carte
Steve Sailer on "the consistently impressive performance of Northern European Jews—known as “Ashkenazi” Jews" which obviously cannot really exist because race and ethnicity don't exist.
Britain from space

Taxpayer's Alliance on the NHS

Conclusions p31 "11,749 more deaths

occurred in the UK than would have if the UK had matched the average mortality

amenable to healthcare rates of European peers.

 This is more than four times the total number of deaths from road accidents

in 2008. It is equivalent to over 2,000 more deaths than those related to

alcohol in 2008.

 The UK has caught up with its European peers at a nearly constant rate between

1981 and 2008. In that time there has been a huge increase in spending on

healthcare since 1999. This suggests that money alone has no discernable

effect on mortality rates.
50 deaths from the German organic farm e coli outbreak. That virtually equals Chernobyl and is 25 times greater than all the deaths from nuclear power production in the last 20 years. This is why every single politician, journalist, newspaper and broadcaster who are not corrupt fascist scaremongers deliberately lying and censoring have devoted as much time to calling for the closing of "organic" farms as  nuclear power stations. But only the one4s that aren't lying fascists.
The Mercalli Intensity Scale - a more useful measure of earthquakes/tremors than Richter.

Europe Can Only Envy U.S. Gas Miracle From Sidelines - WSJ - In fact it isn't a miracle it is a technological breakthrough which the EU and UK governments, being Luddite parasites, are preventing working here. The only thing we need envy is that, even under Obama, the US is not run by as dishonest parasitic thieves as we are.

Telomere Tweaks Reverse Aging in Mice
Computer viruses evolving without human intervention

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