In the article of IHT/NYT, “Spreading an Energy Revolution”. by CHRISTOF RÜHL, published: February 5, 2013, the group chief economist of BP preaches all the wonderful results of fracking. I agree that fracking has its advantages and marks progress. But as I explain in detail in Toxic Capitalism, the technology is also very dangerous if not planned and executed with utmost care. Rühl obviously glances over all those problems. The prospect of North American energy self-sufficiency is real but comes often at a cost that is shifted to future generations to deal with. Especially if some companies, like BP, are known to cut corners with terrible consequences.
See the article:
http://www.nytimes.com/2013/02/06/opinion/global/spreading-an-energy-revolution.html
SCMP reported that worldwide shale oil production could add US$2.7 trillion to the global economy annually by 2035 by slashing the price of crude by as much as US$50 a barrel, according to a recent PWC report. Shale oil production could surge to 14 million barrels per day, or as much as 12% of total oil output from around 1% now, as it expands from its US base over the next two decades, PWC reported.
But not everybody is buying it.
In another IHT/NYT article, “Vast Oil Reserve May Now Be Within Reach, and Battle Heats Up”, by NORIMITSU ONISHI, published February 3, 2013 the author digs into some of the controversies regarding the Monterey Shale in California.
The oil companies’ plans for the Monterey Shale are drawing increasing scrutiny from environmental groups. Though oil companies have engaged in fracking in California for decades, the process was only loosely monitored by state regulators.
The Monterey Shale’s geological formation will require companies to engage in more intensive fracking and deeper, horizontal drilling, a dangerous prospect in a seismically active region like California, environmental groups say.
Environmental groups, including the Sierra Club and the Center for Biological Diversity, are suing the Bureau of Land Management and the Department of Conservation to prevent the opening up of further land to oil exploration and to enforce stricter environmental practices.
Said Kassie Siegel, a lawyer at the Center for Biological Diversity. “Fracking poisons the air we breathe and the water we drink. It is one of the most, if not the most, important environmental issue in California.”
As a result, there is now more attention paid to regulate the whole process and make sure it goes as the oil companies pretend: “there are no problems, no incidents”.
Read the whole story:
http://www.nytimes.com/2013/02/04/us/vast-oil-reserve-may-now-be-within-reach-and-battle-heats-up.html
More worrying is that China is looking at fracking for its own energy revolution – but conditions are much tougher than in the U.S. And Chinese excel in cutting corners. More about fracking in China in a next post.
Consumer & Environment Issues
consumer analysis and impact on environment
Thrift versus waste, talking about food
On Saturday evening I went with the family and several Chinese friends to one of those huge Spa places, close to Sihui Metro Station, one famous for its buffet food. The restaurant was fully packed and Chinese were consuming enormous amounts of food in a near frenzy. I saw a lot of food going to waste, as people fill up enormous plates and often fail to finish. It is one of the examples of food being wasted, not just in the official or wedding banquets, where doggy bags are seldom used for obvious reasons.
Not only China Daily but also incoming president Xi Jinping has pleaded for wasting less.
Chinese New Year is one of those occasions were waste of food, useless presents and extravagant packaging are still the norm.
China Daily has published several calls for thrift, such as:
“Thrift is better than an annuity”, by Op Rana. (8 February 2013)
http://europe.chinadaily.com.cn/opinion/2013-02/08/content_16214356.htm
The article mentions some disturbing figures:
– According to one estimate, more than 200 billion yuan ($32.16 billion) worth of food is wasted as leftovers in China every year. Others say the amount of food wasted in the country every year is enough to feed 200 million people.
– The Institution of Mechanical Engineers says in its recent report that up to half of the food produced in the world ends up as waste every year. This, according to the UK-based independent group’s report, means that as much as 2 billion tons of food never makes it on to a plate.
– A 2011 study by the Swedish Institute for Food and Biotechnology – sponsored by the United Nations Food and Agriculture Organization – which said that about one-third of all food produced (1.3 billion tons) ended up as waste annually, in equal measure in developed and developing nations.
– Up to 30% of the British vegetable crop is not harvested because it fails to meet marketing standards for size and looks.
As I mention in Toxic Capitalism, problems in transportation & storage, unnecessarily strict sell-by dates and buy-one-get-one free offers are to blame. But also consumers’ demand for cosmetically perfect food, along with “poor engineering and agricultural practices” are to blame.
Says Op Rana: “Those indulging in extravagance and exhibitionism should remember another Chinese proverb: A thriftless woman burns the entire candle looking for a match.”
How much pollutants in the air of Beijing?
Yes, someone made the calculation: 4,000 tons, according to a recent article in China Daily.
A total of 4,000 tons of pollutants are estimated to be in the air in urban areas of Beijing on serious pollution days, according to a researcher with the Chinese Academy of Sciences.
The calculation was based on the size of Beijing’s urban area and concentration of pollutants, including PM2.5, or particulate matters less than 2.5 microns in diameter.
Many parts of central and eastern China witnessed more than 20 days’ of hazy weather in January, according to National Meteorological Center, the worst since 1961.
Beijing and its neighboring areas were the hardest hit, with only five days free of smog weather in Beijing in January, according to the Beijing Meteorological Bureau. Concentration of PM 2.5 was as high as 1,000 micrograms in parts of Beijing on serious pollution days in January.
The World Health Organization recommends average 24-hour exposures of less than 25 micrograms per cubic meter. So, 25 versus 1000…
Welcome to Beijing!
Air pollution in Beijing and fuel quality
Fuel quality is a much overlooked issue. Beijing tries to enforce higher fuel standards but gasoline and diesel fuel sold in other locations is often of a very poor quality, not only affecting pollution but also messing up the engines and exhaust systems of the newer cars. Some famous brand cars can simply break down because of the bad fuel and then the brands are attacked for being “of poor quality”. Things that need to be done: reduce the power of the big oil companies, enforce quality and adjust fuel prices.
Beijing has been having some really bad, bad days with its air pollution. Today we were again at AQI levels of over 400 for some time. It does not help we have now in the city 5.2 million vehicles, increasing at 200,000 per year. In 2008 we had 3.13 million.
As far as I understand, transport in the city is responsible for about half of the pollution (car exhaust, dust, etc.). According to estimates, 20% of the pollution comes from coal burning, 20% comes neighboring provinces and 25% from vehicle emissions.
The big oil companies are dragging their feet as it requires big investments. In Beijing sulphur content is supposed to be under 50 ppm; neigboring provinces are at 150 pp. Then we have diesel with 2,000 ppm. So, the bad air comes to Beijing and cars outside of the city face breakdowns.
See more about it:
“State-owned oil companies in firing line over Beijing’s pollution”
Ministries are almost powerless to enforce air quality standards amid state-owned entities’ influence and their quest to keep costs down
4 February, 2013 – Reuters in Beijing – SCMP
http://www.scmp.com/news/china/article/1142784/state-owned-oil-companies-firing-line-over-beijings-pollution
“The search for culprits behind the rancid haze enveloping Beijing has turned the spotlight on the mainland’s two largest oil companies and their resistance to tougher fuel standards.
Bureaucratic fighting between the environment ministry on the one hand and China National Petroleum Corp (CNPC) and Sinopec Group on the other has thwarted stricter emission standards for diesel trucks and buses – a main cause of air pollution blanketing dozens of cities.
…
Delays in implementing stricter emission standards are rooted in money – chiefly, who should pay for refining cleaner fuels. By some estimates, vehicle emissions contribute as much as a quarter of the most dangerous particles in Beijing’s air.”
Property: a way to spend the dirty money in China
“Crooked cadres in China prone to hide their dirty money in property”
“Luxury flats are a relatively easy and inconspicuous place to conceal dirty money”
By Jane Cai in Beijing, SCMP, 7 February, 2013
http://www.scmp.com/news/china/article/1144893/crooked-mainland-cadres-prone-hide-their-dirty-money-property
The cancer of corruption is showing its impact on society but people are finding out (finally). The corrupt distort the real estate market, buying properties in bulk, driving prices up, leaving apartments (and even office space) vacant in large quantities. Then we are told there is “high occupancy rate” (of the ones on the market for rent!). Rental prices have gone up in Beijing as a result, making life very difficult for migrant workers who do not have the possibility to buy something (restrictions and too expensive). Service people are harder to get here as they cannot cope anymore with the rising costs. Restaurants, shops and offices are closing down, or move to other locations as rents are too high. I know several restaurants who were successful but had to give up; some had their rent increased by 300%. It is simply unsustainable. The corrupt not only rob the people, they also poison society. How can one still respect the officials if this is not cleaned up?
Yesterday we were driving way out of the city, to the north. I was looking at the rows and rows of huge apartment complexes. Just wondering: they might be all sold, but how many are actually inhabited?
I am told office space is tight. Then why do I see all those vacant spaces in the different SOHO complexes? The explanation: owners do not bother to rent them out. Or their conditions are unrealistic.