[cube]

$this->bbcode_second_pass_quote('Tyler_JC', 'T')he Law Of Receding Horizons is incorrect.



Does anyone dispute these charts?

[LoneSnark]

But if you look at the graphs they do not need to drop any more as they are already below what we currently pay for other technology (11 cents/kwh).

[Tyler_JC]

How about this one from the department of energy?



As for the clean energy tax credits, they cost less than a billion dollars a year. It's a rounding error.

[Tyler_JC]

$this->bbcode_second_pass_quote('LoneSnark', 'B')ut if you look at the graphs they do not need to drop any more as they are already below what we currently pay for other technology (11 cents/kwh).

[LoneSnark]

While peak natural gas might play a role later, since NG prices have not increased very much it is not playing a role today. As for peak coal you are mistaken: coal production has plenty of room to maneuver, non-geologically speaking (human terms).

And you need to stop trying to apply a general purpose law as an argument. It is neither self evident nor obvious. You need to be specific: what exactly is changing and why? As wages are independent of oil prices and tools and equipment are usually made with electricity, which can come from coal, nuclear, etc, what is driving up tool prices? The largest component of tools prices was the price of other tools to make new tools; second is wages; and finally energy primarily in the form of electricity. So, your words as spoken do not make sense, could you please spell it out in more detail?

Is doubling oil prices going to tripple electricity prices? Why? Perhaps you think doubling oil prices is going to cause wages to double? Out of the goodness of employer's hearts?

[namenick]

LOnesnark wrote: $this->bbcode_second_pass_quote('', 'N')ow, this does present the potential problem: if natural gas and electricity rates increased dramatically faster than oil prices then the process would become unprofitable.

[Tyler_JC]

$this->bbcode_second_pass_quote('pstarr', '
')
The Law of Receding Horizons is a particular model that Westtexas and others at the OilDrum created to examine and predict future access to nonconventional crudes. It has proven accurate. It is a pretty simple concept. As petroleum prices increases, petroleum extraction equipment (built with petroleum) prices also go up.

The confusion arises when those tool prices do not go up in lockstep, but only appear after a delay. Such is the nature of a complex industrial society. It takes time for inflation to filter through the system.

[yesplease]

$this->bbcode_second_pass_quote('pstarr', 'P')eak natural gas and peak coal might play into this crisis, don't you think? One is around the corner and the other is around the corner, geologically speaking.

[LoneSnark]

$this->bbcode_second_pass_quote('', ' ')What would happen if Syncrude had to burn 1.1 barrel of oil to power the generators which provide the energy to extract 1 barrel of oil? Would they abandon the tarsands projects?

[namenick]

$this->bbcode_second_pass_quote('LoneSnark', '')$this->bbcode_second_pass_quote('', ' ')What would happen if Syncrude had to burn 1.1 barrel of oil to power the generators which provide the energy to extract 1 barrel of oil? Would they abandon the tarsands projects?

[SchroedingersCat]

Zero sum game. Finite resources. There are only so many drilling rigs. Companies can build more, but it takes time, money and resources. All of these are being bid up by those who have the most available financial resources. Iron ore needs to be mined and refined to make steel. The trucks to do this need tires. The cost of energy to refine the ore is skyrocketing. There are only so many project managers, engineers, and skilled tradesmen available.

A project planned in 2004 with 2004 prices will not be completed under budget. If you budget for the 2-3% inflation the government is claiming you will be very surprised when the material and labor costs of your project increase by 50% in 3 years. Oil prices alone have almost tripled since 2004. Most other commodities have followed. Rising prices do not create new natural resources. They only make recovery of less easily extracted resources more profitable.

[Tyler_JC]

$this->bbcode_second_pass_quote('SchroedingersCat', 'Z')ero sum game. Finite resources. There are only so many drilling rigs. Companies can build more, but it takes time, money and resources. All of these are being bid up by those who have the most available financial resources. Iron ore needs to be mined and refined to make steel. The trucks to do this need tires. The cost of energy to refine the ore is skyrocketing. There are only so many project managers, engineers, and skilled tradesmen available.

A project planned in 2004 with 2004 prices will not be completed under budget. If you budget for the 2-3% inflation the government is claiming you will be very surprised when the material and labor costs of your project increase by 50% in 3 years. Oil prices alone have almost tripled since 2004. Most other commodities have followed. Rising prices do not create new natural resources. They only make recovery of less easily extracted resources more profitable.

[namenick]

$this->bbcode_second_pass_quote('Tyler_JC', '')$this->bbcode_second_pass_quote('SchroedingersCat', 'Z')ero sum game. Finite resources. There are only so many drilling rigs. Companies can build more, but it takes time, money and resources. All of these are being bid up by those who have the most available financial resources. Iron ore needs to be mined and refined to make steel. The trucks to do this need tires. The cost of energy to refine the ore is skyrocketing. There are only so many project managers, engineers, and skilled tradesmen available.

A project planned in 2004 with 2004 prices will not be completed under budget. If you budget for the 2-3% inflation the government is claiming you will be very surprised when the material and labor costs of your project increase by 50% in 3 years. Oil prices alone have almost tripled since 2004. Most other commodities have followed. Rising prices do not create new natural resources. They only make recovery of less easily extracted resources more profitable.

[Tyler_JC]

Sorry, I should have been more specific.

I'm talking about oil resources.

Oil reserve = oil resource.

[namenick]

$this->bbcode_second_pass_quote('Tyler_JC', 'S')orry, I should have been more specific.

I'm talking about oil resources.

Oil reserve = oil resource.

[MonteQuest]

$this->bbcode_second_pass_quote('Tyler_JC', 'T')he Law Of Receding Horizons is incorrect.



Does anyone dispute these charts?

[Heineken]

Not only are the cost-decline curves flattening, in time they will start to rise. Even windmills and photovoltaics require maintenance, and maintenance (and replacement) costs are going to spike, inevitably.

I bet the day will come when you can't even get parts for a wind turbine without breaking the bank, assuming the parts are available at all or can be transported to where they are needed.

[LoneSnark]

$this->bbcode_second_pass_quote('', 'N')ot only are the cost-decline curves flattening, in time they will start to rise. Even windmills and photovoltaics require maintenance, and maintenance (and replacement) costs are going to spike, inevitably.

[yesplease]

$this->bbcode_second_pass_quote('Heineken', 'N')ot only are the cost-decline curves flattening, in time they will start to rise. Even windmills and photovoltaics require maintenance, and maintenance (and replacement) costs are going to spike, inevitably.