Act I finds the protagonist boldly proclaiming an original and bold explication of the economics and history of the gas and electric industries. In Act II, we use the weapons developed by our protagonist to render much that passes for sound energy policy both tragic and comedic.

In Act III, we search deeply within ourselves to discern if the protagonist provides answers to the modern vexations that ail us. Come let us listen to Friedman Milton as he disarms the protagonist.

Black and White–or Gray?

The Bradley Project seems to dichotomize the world into free market capitalism and political capitalism. To paraphrase George Orwell, free markets good; political markets bad.

I have no quarrel with Bradley’s conclusion that both energy generally and natural gas and electricity in particular have been victims of political capitalism in all its hoary forms.…

“The forcings that drive long-term climate change are not known with an accuracy sufficient to define future climate change.”

– James Hansen, “Climate Forcings in the Industrial Era,” Proceedings of the National Academy of Sciences, October 1998, p. 12753.

“In view of the immense power of natural weather and climate fluctuations and the great buffering capacity of the Earth, especially the ocean, it is easy to be skeptical about whether small anthropogenic changes of atmospheric composition can have important practical impacts.”

– James Hansen et al., “How Sensitive Is the World’s Climate?,” National Geographic Research & Exploration, 9(2): 1993, p. 157.

“Climate is always changing. Climate would fluctuate without any change of climate forcings. The chaotic aspect of climate is an innate characteristic of the coupled fundamental equations describing climate system dynamics.”

Creative destruction , a term popularized by Joseph Schumpeter, is the market process whereby bad is eliminated, the better replaces the good, and past performance gives way to new strategies and victors. No firm is forever, and financial loss is a characteristic of capitalism, as is the more used term profit.

Energy is the story of creative destruction. Coal gas and later coal oil replaced a variety of animal and vegetable oils, including whale oil, camphene oil, and stearin oil. Crude (mineral) oil then displaced manufactured (coal) oil, just as later natural gas would displace manufactured (coal) gas.

Coal itself displaced primitive biomass (burned plants and wood) and other forms of renewable energy, such as falling water and wind. Fossil fuel was a concentrated, continuous-burn industrial-grade energy.

The intensity of fossil energy can be understood as a stock of the sun’s work over the ages, not a dilute flow from the sun (solar, wind)–or a low-density mass from limited years of sunshine (biomass).…

The European Energy Review has published a comprehensive article on the EU energy policy, entitled “Europe’s green energy chaos” by Andrew MacKillop (sometimes appearing as McKillop), an independent energy analyst and project advisor who has written on energy topics for over 35 years, and who worked for the European Commission’s Directorate-General of Energy as a policy expert in the 1980s.

EU policy can be summarized as 20-20-20 by 2020. Catchy isn’t it? It means 20% improvement in energy efficiency, 20% reduction in emissions, and 20% use of new renewable energy sources – all by 2020.

When publicized, the EU plan was (properly) criticized by the Economist and Dieter Helm, the chairman of the ad-hoc committee established by the EU to provide expert advice. MacKillop’s critical analysis of the current problems of government-heavy energy policy is spot on.…