The Bullroarer - Friday 6th June 2008

The Age - Rudd calls for better public transport

Better public transport is part of the answer to soaring petrol prices, Prime Minister Kevin Rudd says.

Mr Rudd said he had already raised the issue of working with the automotive industry to manufacture hybrid fuel-efficient cars in Australia, producing more savings for motorists and more fuel-efficient transport.

"Secondly, hasn't the time come for some decent, decent public transport systems, invested in by the national government across our major cities so people don't burn their petrol prices on the way to work," he told the Nine Network.

Stuff.co.nz - The economy: Good, bad and ugly

Home lending rates have started to fall, with the Reserve Bank having signalled official cash rate cuts could come before Christmas.

But it is a rare ray of sunshine in an otherwise gloomy economic outlook, which foresees falling house prices, high inflation and a big surge in unemployment.

Governor Alan Bollard held official interest rates steady yesterday at 8.25 per cent but told a parliamentary committee there could be room for two cuts this year.

[.....]
He also announced one of the worst inflation forecasts in 20 years, saying there would be "unpalatable" results in June and in September when oil and food price rises would help to push inflation to 4.7 per cent - well above the bank's 1 to 3 per cent target range.

News.com.au - Fuel, rates bite at construction industry

THE construction industry's woes continued in May due to high interest rates and the soaring cost of fuel, a survey says

SMH - Household energy use soars

HOUSEHOLDS are gobbling up more and more power and will use an extra 50 per cent by 2020, thanks to the combination of a growing population, bigger houses and an ever-increasing appetite for new appliances, particularly televisions.

Stuff.co.nz - Fuel cost tipped to bite at airports

Upheaval in the airline sector looks likely to result in a tougher 2008-09 for New Zealand's big airports.

Both Air New Zealand and Qantas have signalled they will reduce capacity on long-haul routes because of sky-rocketing jet fuel prices.

NZ Herald - Virgin Blue must lift fares to survive: analysts

Record fuel prices meant the "ideal scenario" was for Brisbane-based Virgin Blue to implement a 10 per cent price rise immediately, analysts Matt Crowe and Russell Crichton-Browne said in a report to clients. Increasing fares 5 per cent this year and in 2009 would save Virgin Blue although leaving the company with a "not very attractive" growth profile.

Scoop.co.nz - New Hybrid Fuel Cell franchise launches

OctaFuel’s environmental fuel-saving Hybrid Fuel Cell retro-fits to 99.9% of all vehicles – provides up to 40% savings at the pump.

At a time when motorists are seriously tired of escalating petrol prices, OctaFuel’s timing couldn’t be better, suggests Michael Fresnel, General Manager, OctaFuel New Zealand.

“Research shows the $2 mark is the tipping point when 21% of consumers will change their behaviour – and here we are, through that barrier. That same research suggests the next barrier is just around the corner at $2.20 – when 51% of consumers will be ready for change. The OctaFuel alternative is the obvious choice.”

The Age - 500 jobs to go at Holden

[.....]
Record fuel prices have turned many consumers away from the traditional six-cylinder sedans built in Australia by Holden, Ford and Toyota, the remaining local car makers. Higher interest rates are also denting demand for new cars in general.

The Age - Petrol price's silver lining

RECORD oil prices could deliver an unexpected bonus to Australians, with proposed rules to tackle climate change now likely to be less costly for businesses and consumers.

The Rudd Government's climate change adviser, Ross Garnaut, says price rises for electricity and petrol that will follow the launch of carbon trading in 2010 may not need to be as harsh as first thought.

Professor Garnaut said rising prices for oil, coal and gas were all starting to do the work of the emissions trading scheme — that is, curbing energy consumption and greenhouse gas emissions.

Stuff.co.nz - Power-saving campaign nears as station fails

One of the country's biggest gas-fired power stations has failed just days before electricity companies are expected to call a nationwide energy savings campaign because of the drought in the South Island.

Carbon News - Clean energy attractive to investors

International corporate responsibility expert Anne-Maree O’Connor is predicting that the shift to green investing is here to stay.

Stuff.co.nz - Kaipara tidal energy project gathers momentum

AN ENERGY farm harnessing the power of strong tidal currents at the entrance to the Kaipara Harbour in Northland looks likely to be the first new marine energy kid on the block by winning the government's initial funding package for a new field of renewables.

TV NZ - Food crisis could hit Pacific hard

Across the Pacific, where so many already depend on aid to survive, governments are nervously planning how to best fight the looming threat of hunger.

They are grappling with the issue facing so many developing countries - food security, at a time when food prices are at 30-year highs.

[.....]

Riots over high food and fuel costs have already broken out in countries as far flung as Cameroon, Indonesia and Mexico.

News.com.au - Drivers changing habits to save fuel

MORE than 40 per cent of motorists have changed their behaviour in a bid to save fuel, a survey shows.

SMH - Green-car fund to hurt economy

THE Federal Government's $500 million plan to subsidise Australian car manufacturers to build green cars is unlikely to reduce greenhouse gas emissions and would hurt the economy, says the Productivity Commission.

ABC - Fishing tourism hit by fuel costs

Fishing tour operators are struggling with the rising cost of fuel.

While commercial fishermen use diesel engines, which entitles them to a government rebate, many fishing tour operators use unleaded petrol, which doesn't receive the subsidy.

Victorian tour operator Wayne Sharrock says the fish are biting farther out this year, and combined with the rising cost of fuel, it's costing him an extra $100 a day.

The Age - The climate of climate opinion

THE Rudd Government is beginning to reap the effects of unrealistic expectations created by its own election grandstanding on climate change.

All too often, the debate in Australia drifts off into a fantasyland of no oil, no coal, no nukes; a naive, childlike vision of a future with just the sun and wind in our faces … and sackcloth on our backs.

But now, thanks to the petrol price furore, the issue of energy security has leapt into the mainstream.

Rising prices doing the work of the ETS ...hmm that's a hard one to call. If the ETS include petrol, the aluminium industry, disses dodgy offsets and sets a target of annual carbon reductions of 2-5% we should be 'on track' in theory. However if we are headed for a slowdown anyway the carbon cap may be achieved without any need to sell permits. In that case Westpac have done their dough paying an early $19 per tonne of CO2. If that price is realistic I guesstimate it will work out about 2c per kwh of coal fired electricity and about 4c per litre of petrol. If the ETS turns out to be fair dinkum the next step will be to provide extra help for lower carbon alternatives.

What I can't fathom is why nobody in the MSM never delves into the reasons behind rapidly rising prices, oil prices in particular, and then follows through with the "Oh shit" moment. Listening to Garnaut this morning rattel on about the danger of climate change I couldn't help feeling like a giant cloud of green smoke is being pushed out as fast as possible to try to mask the real demon which is peak oil.

Ay least he is talking about public transport. The hybrid cars business is daft though. They don't make a lot of sense anyway; but to invest billions in developing them in a small market is ludicrous even if the auto industry was a good investment opportunity.

Remember that politicians don't like large manufacturing business closing down suddenly - from that perspective it makes sense to encourage the industry to change direction and perhaps survive in some form.

If we get really lucky Holden or Ford could end up exporting hybrids to the US or to Asian markets.

I can't hurt anyway - unlike a lot of other things people are proposing...

There is substantial excess capacity in the global auto industry and both GM and Ford have uncertain futures considering their parent companies problems, while Toyota has already developed hybrid technology. In a general sense I am against governments backing "champions" and developing hybrid entails significant risk.

From a wider strategic perspective I think diesel/kerosene is going to become the limiting factor in liquid fuels. Close together in the distillation column they are to a great extent interchangeable at point of use. My view is that if the government was looking for a strategy, it would be make sense to use our gas resources by developing GTL on a significant scale. This would provide a much more flexible outcome which would help insulate Australia, its trucking, farming and aviation; and if there is any left over it could be used in private vehicles. The existing Ford & GM plants could churn out diesel cars with virtually nil extra investment, so their futures could be made more secure at very little extra cost.

The GTL plants could be close to the source of gas and may even entail more efficient use of the available energy than LNG. Especially as we get to use it instead of selling it off cheap to other countries.

Unfortunately all this does require joined up thinking; and Rudd has yet to demonstrate he is thinking at all (about energy), let alone joined up thinking.

Well - that is a nice pipe dream - hopefully I'll have my gas post finished this weekend, so you can re-evaluate.

If you want a GTL fueled transport system for a meaningful length of time, you'll need a government that is prepared to put a stop to further expansion of LNG exports at some point in the not-too-distant future - and Ferguson's policy seems to be the opposite of that (he wants both, but he's just living in a dreamworld).

GTL + CTL might be a different kettle of fish - assuming you couldn't care less about carbon emissions...

Gav,

We're going to have to drop that familiar old "Kettle of Fish" expression. I agree with the 2nd-last news item above...

"..the fish are biting farther out this year..."

Allow me to introduce a word that has apparently never appeared on TOD before: "Tunageddon"

Classic :-)

I quite like the description of the ICCAT as the "The International Conspiracy to Catch All Tuna" too.

http://peakenergy.blogspot.com/2008/05/jellyfish-slime-and-international...

While commercial fishermen use diesel engines, which entitles them to a government rebate, many fishing tour operators use unleaded petrol, which doesn't receive the subsidy.

Why are they using unleaded? Or does this mean the fuel used to make two stroke mix?

Anyway, it doesn't matter that they are using unleaded... it's the activity itself that is not covered by the Fuel Tax Credit Scheme... and for good reason I would have thought. It must be the most energy hungry indulgent way to catch a fish.

Under the guidelines for fishing, acitivities connected with recreation, sport or tourism are not coverd by the scheme (page 13 of the guide NAT 14584-047.2006)

XTLs which use FT technology all have some process emissions since they require incomplete combustion. For CTL process emissions are comparable to tailpipe emissions. The beauty of a strict carbon cap is that one litre of CTL can lock out about two litres of petro fuel. That plus water requirements should make people literally 'think twice' about CTL.

GTL needs to be evaluated against CNG. Both require extra effort but which works out better? If Australia makes a big switch to gas based transport fuels it could derail LNG expansion plans.

Yes - pie in the sky. I totally agree. As I said - "joined up thinking". For a month or two I was really hopeful. Now Rudd just says and does the same as Howard. Maybe "Yes Minister" was a documentary. At least that awful smug Costello is out of the picture - for good I hope.

Also a big GTL plant will take a long time to build, probably too much time. I am aware of a small net increase in CO2 from GTL (including product use vs diesel). I imagine if the CO2 from the GTL plant could be captured it would be relatively straight forward to inject back into the gas field from whence it came. I am dead against CTL though.

As for the fish - I am reminded of a movie with Ford Prefect.............

I've just been listening to Kevin Rudd on the Sunday BBC Radio News (he was being interviewed on "Meet the Press") saying that the time has come to "apply the blowtorch" to OPEC!

"...Every head of government across the world is dealing with this challenge now and it goes to global oil supply in large part, the role of OPEC. OPEC need to open the production lines to a greater extent, increase global oil supply. They've done it a bit in response to representations from President Bush. The G8 provides an opportunity to apply the blowtorch to the OPEC organisation - and it's time that happened."

Ignoring any amusing mental images of what would happen if Kevin did indeed apply a 1300C flame to a barrel of gasoline (!), this is another example of Rudd's apparent belief that there is a big tap somewhere in the Kingdom of Saudi Arabia and that we simply need to give it a few turns for our petrol prices to come crashing down again. He's certainly not talking as if he secretly "knows" about resource depletion and is just spinning the politics...

How on Earth can we get our politicians to recognise the reality of oil stock depletion?

(Saildog, how's this for joined up thinking:
Blowtorch - Resource War - Hormuz Closure - Olduvai Gorge???)

Rudd should pay attention to the famous quote from the stranded passengers in the Andes air-crash: "Let's take some of the meat off the pilots, after all, they got us into this mess!"

Well - even if Rudd has heard of peak oil its not unsurprising that he might dismiss it, given that his advisory bureaucracy all disagree with the concept (at least over his term in office).

In any case, OPEC is the most convenient scapegoat going - big oil and speculators might bite back if blamed, and geological factors are too impersonal to fill the role effectively (though he did have a window to blame this on the lack of foresight of the previous government which is rapidly closing).

Maybe "Yes Minister" was a documentary.

"You're not asking me to make a brave decision, are you?"

The obvious problem, however, is that there are no Australian owned vehicle manufacturers (beside a few kit car builders). The Australian government is loathed to give handouts and extra support to GM and Ford when thier decision making is coming from Detroit and does not have Australian interests as the first priority. Same goes for the Japanses companies. Yet the Australian goverment does provide hundreds of millions of dollars of support (ACIS, R&D Tax Concessions and other incentives like AutoCRC). They are compelled to do so since the auto industry supports so much of the other manufacturing industry with plastics, metal fabrication and electronics etc. Plus it is one of the largest employers in Australia and contibutes a significant proportion of the nations GDP. The ACIS benefit is a big screw up in my opinion.. It provides incentive to import components by providing import credits and hence supports the destruction of a lot of the local automotive suppliers that can not compete with Chinese and Indian suppliers.

What we really need in Australia is a system that provides incentive to reverse the globalisation of the auto industry and provide support for a stronger local and regional technology, skills and manufacturing infrastucture. I believe this can only be done with a wholy Australian owned automotive manufacturer. And it just so happens that there is a vehicle manufacturing plant in Adelaide that is sitting idle and would be an ideal place to start Australian owned electric vehicle production.

..

All too often, the debate in Australia drifts off into a fantasyland of no oil, no coal, no nukes; a naive, childlike vision of a future with just the sun and wind in our faces … and sackcloth on our backs.

Who is the idiot who writes this drivel?

Tony Parkinson was a senior adviser to former foreign minister Alexander Downer in the Howard government.

Ah, it turns out he's a member of the Institute of Public Affairs, of whom sourcewatch tells us

The Institute of Public Affairs is a right-wing, corporate funded think tank based in Melbourne. It has close links to the Liberal Party, with it's Executive Director John Roskam having run for Liberal preselection for a number of elections. Its key policy positions include advocacy for privatisation, deregulation, reduction in the power of unions and denial of most significant environmental problems, including climate change.

They've been funded by BHP-Billiton, Western Mining (a former WMC exec is now in the IPA), Caltex, Esso (Exxon-Mobil subsidiary), Woodside, and fifteen electricity companies.

What an amazing coincidence that a man who receives money from companies who make their profits from the extraction and burning of uranium and fossil fuels should tell us that the vision of an Australia without burning uranium and fossil fuels is "naive" and "childlike".

In other news, the PR agency for McDs says it's very nutritious and we'd be foolish to eat at home, the wife of my local Mitsubishi dealer recommends against taking the bus, and the retiring head of Macquarie Bank says that yes, CEOs really do deserve that high pay.

I thought the style was familiar.

Miss-characterise your opponents and denigrate them ... eco-extremism, Mouseketeers, tantrums, delusional, haughty.

I'm surprised he didn't use the "green as a new religion/faith" line previously used by the IPA... becuase as we know, religion and faith go hand in hand with "extremists" and that's just one conceptual step from terrorist.

making coal more expensive under a carbon trading system in Australia will do little or nothing to reduce the appetite for coal globally

It's funny that when it suites them the IPA denies that price influences behaviour.

it's time the "clean, green" brigade dropped the sermonising and began to grapple earnestly and rigorously with the challenges of framing an intelligent and effective climate change strategy relevant to the world as it is, not the world as we wish it were.

This is also a strange thing to say. Well more stupid really. For the world as it is is changing.. from what we wish it was!

ONE thing is revealed though. Does this mean that the silly IPA climate denial pieces in The Age are finished to be replaced by a new round of silly IPA "we have the answer" pieces?

The Holden engine plant closure can be seen as part of GM's broad sweep of global plant closures - including a "review" of the "iconic" Hummer.

...Yes, well, I suppose "iconic" is one word you could use for the Hummer!
The Hummer's demise would certainly be a powerful symbol of the long-needed awakening amongst car buyers.

(Goodness, I wonder what TOD posters can use as shorthand for "gas guzzler" if the Hummer becomes history? Maybe here in Oz the Pajero may fill the gap, because of the unfortunate fact that its name translates as "wanker" in Spanish! - BTW, the correct pronunciation sounds like "Paherro", in case you're inspired to yell it out on the street.)

Anyway, I have some confidence that the Hummer may really be toast, given GM Chairman Wagoner's clear warning of a permanently raised oil price

"These prices are changing consumer behavior and changing it rapidly," said Chief Executive Officer G. Richard Wagoner Jr. "We at GM don't think this is a spike or temporary shift. We believe that it is, by and large, permanent,"

(You can see the video of Wagoner saying this here: http://www.baltimoresun.com/business/bal-bz.gm04jun04,0,4167751.story - It's quite a historic progression for GM, given Wagoner's previously somewhat hazy references to Peak Oil)

A funny thing is that in the Drumbeat item of a few days ago which mentioned this same speech;
GM to close 4 factories, may drop Hummer, MSNBC de-emphasises GM's conclusion on oil prices and selectively quotes Wagoner to portray the "spike" as a spike in truck demand!

It's hard to say whether this is another example of media cluelessness, or some deliberate spin by NBC. From a quick look at Google I'd say that about half the Internet news coverage has been watered down in this way.

This new LPG hybrid seems like the right car for the times, not the soon-to-be-extinct Falcodore. If GM gets it so hopelessly wrong on future markets that seems to strengthen the case for government intervention, at least on broad guidelines.

If all companies got it as wrong as GM then you might make a case for govt intervention but some haven't - Toyota for one, and they are the world's biggest car company.

There are plenty of small EV companies hatching in the undergrowth now as well, waiting to eat all those tasty dinosaur eggs...

I wonder if Gunns Ltd have twigged to the possibilities of cellulosic biofuels now that paper pulp isn't going so well?
If say 3 millions tonnes a year of log inputs were truly sustainable that could be billions of litres per year of ethanol or FT diesel, surely more profitable than woodchips.

The latest GetUp campaign is around fixing our transport systems - so now might be an opportune time to send some words of advice to your local MP :

http://www.getup.org.au/campaign/FixTransport&id=355