“I have long been noted for ability to call turning points for industry: this suicide is one. Current industry support of EPA will create massive political backlash such as never seen before in US. ‘My early death by fossil fuel reflects what we are doing to ourselves.’ D. Buckel”
The above tweet by Amy Myers Jaffe (@AmyJaffeenergy) on 8:31 am – April 16th should live in infamy.
First, the author claims superior knowledge and prediction, not exactly a talking point for the Malthusians who have long predicted a (premature) end to the fossil-fuel-driven, growing energy sector. Peak oil demand is her new mantra, replacing her old fears of Peak Oil and “geopolitical peak oil.”
Second, Jaffe wildly predicts that the Trump Administration’s consumer-first, taxpayer-first, entrepreneur-first/crony-last energy policy is setting itself up for a massive reversal.…
“When an abundant natural fall of water is at hand, nothing can be cheaper or better than water power. But everything depends upon local circumstances. The occasional mountain torrent is simply destructive. Many streams and rivers only contain sufficient water half the year round and costly reservoirs alone could keep up the summer supply.”
-W. S. Jevons (1865)
Serious students of energy policy should read the blogs at the Institute for Energy Research (IER), not only those at this site. The current blog at IER, “Renewables Generated 103 Percent of Portugal’s Electricity Consumption in March [2018],” explains that country’s unique situation of being hydro-dependent and wind-tied. And so it is that abnormally high rainfall has blessed Portugal this year–quite the opposite from a year ago.
Enter the wisdom of the ages, which in this case gets to W.…
“When President Reagan decontrolled prices in January 1981, the regulatory arbitrage was over…. The strangest regulatory episode in US history was done.”
Economist Robert Murphy has summarized what I believe is the most unique, confounding, consequential regulatory episode in American history in his piece: “The Crazy Crude Oil Price Controls of the 1970s.” [1]
Yes, it happened some decades ago. But if you want to know why no economist in recent history has espoused price controls for crude oil and petroleum products, this experience rings loud today.
Basically, a large group of opportunistic middlemen seized profits that federal price and allocation regulation kept from the rightful industry parties (wellhead producers, in particular). It is the story of the unintended consequences of government intervention. Or entrepreneurial gaming in the face of regulatory constraints (with positive social outcomes in this case)–what Israel Kirzner called superfluous entrepreneurship.…