Spiritofireland.org - suggests energy independence in five years and much more

[orbit]

So I had my first meeting with an ESB employee last night, and between a few drinks and other things found the following out. Bear in mind that my memory sucks and so it's possible that what I'm stating as facts could well possibly be misinterpretations.

Let's start with the easy one, nuclear power. Apparently we can't have nuclear power in Ireland. It's in the constitution...twice (to be sure, to be sure). So if we are ever going to have nuclear power, it'll have to be through a referendum

Indeed

[Geckko]

If you have two carrots for sale, one comes from farmer joe down the road and is sold in a local family run shop, and the other comes from a farm in china and is sold in tesco.

the first costs €1.20 the second costs €1.

Under your logic it is always 'best' to buy the cheaper carrot, but thats only on an individualist basis, the individual is 20 cents better off, but from a public policy basis, it can be much better to buy the more expensive carrot if the money stays in the local economy rather than expatriated as profits by a multinational and exported to pay for imported carrots.

International trade theory tells us we should produce goods unless it distracts us from producing a product that we are relatively more efficient at producing.

(ie we should not use resources, farming at 5% profit if the same resources could be used for tourism at 30% profit) but where there is no absolute advantage in any product, the country should focus instead on producing the things at which it has a 'comparative advantage'.

Trade theory doesn't tell us to "focus" on anything. It tells us to avoid the sort of flawed ideas you propose - how is that for irony, you have it completely reversed. It observes the natural process of trade, relative comparative advantage and what outcomes that would be expected to be produced.

Have you actually studied any economics? Your analysis is naive and deficient. Where do you think the €1.20 used to buy the local carrot comes from? It comes from resources employed to generate it. You are using up more resources to generate the income to pay for the resources needed to produce the carrot.

In turn the (greater amount of) resources need to produce the local carrot are now not available to produce anything else - so net that off.

Start your reading with the theory of trade and an Edgeworth Box Diagram.

[Geckko]

Here is a follow up thought experiment.

Imagine Ireland could stop all imports (i.e. become "self sufficient"), but keep exporting the amount the country exports now. What do you think would happen to the standard of living in the country?

Well, have a look at the numbers. From 2007 accounts

Persently Ireland has total output of €200bn (let's just round and assume that you nationalised all FDI).
Exports have a value of €150bn
Imports have a value of €130bn

So under Akrasia's economic policy as the newly installed Finance Minister everyone is forced to buy carrots from local producers, along with other food, clothing, energy etc. etc.

Excellent, we "keep the money in the country" as you say. So let's revisit the numbers.

We no longer pay €130bn out for imports. Doesn't that mean total output in the country goes up to €330bn? (200+130). Well, no. There might be a little spare capacity to increase output by 65% (well, in 2007 there was zero spare capacity in Ireland). But I will be generous and say that by squeezing a little more out of the labour market and using working our capital base harder we could find another 10% of productive capacity.

So output actually goes from €200bn to €220bn. Not as hot is it, but 10% increas ein output isn't to be sneezed at. So you must be right, "buying local " is good.

But hang on!!!! I forgot, we are still exporting €150bn of this output. That means we have only €220-€150 = €70bn of that output for local use (i.e. consumption, investment). a 65% drop in our local consumption and investment in money terms.

So, time to slash that grocery basket (65% less food for your household), see those 4 cars? 3 have to go. Better trun of the central heating and hot water, you need to slash your energy consumption by 65%. I haven't started with investment yet.

And we haven;t even begun to consider the impact on total factor productivity this would have. That is - by insisting that good and services are produuced in Ireland it is likely that you will expend more resources producing all output on average, which mean outpt would morelikely fall below 200bn, instead of rise to €220bn - therby leaving the country even worse off.

If you wanted to maintain your standard of living, you would have to stop exporting to keep the output for local consumption. And you get back to where you were, except your output is now produced in a far less efficient way (€1.20 carrots etc.) so the total size of output is lower and hence output per head and income per head is lower.

This is the absurd extreme, but the effects at the margin from xenophobic protectionist policies is the same - just that they are harder to notice.

Best to trade for best product/service at best price, wherever you find it. Everyone wins - that is the conclusion of trade theory.

[Geckko]

I feel so strongly about educating people on this, I am willing to risk disdain and give another thought experiment.

Let's assume Akasia is correct and we would be better off if we buy locally produced goods. So we don;t buy that Chinese carrot, but from farmer O'Leary down in Cork.

Well, let's take that thinking further. I live in Leinster. Surely the Lesinster economy would benefit even more from me buying not from a Munster farmer, but one in Leinster, So I will buy from farmer Murphy in County Wexford instead.

But hang on. I live in County Dublin. surely I can make a further improvement in the County Dublin economy by buying my carrots from farmer Flanagan in Lucan.

But I live in D14, I should buy from a local grower and then the D14 economy will be even better again.

And so on. You see where this ends don't you. It implies that if you confine all output to your own household you will be better off. But off course that is nonsense. You don;t grow your own food, make your own clothes, build and service your own own car. You employ your limited productive resources to do what you are most productive at and then trade with others. Those imports into your household (Those bags of groceries for example) are a good thing that raise the standard of living in your household. So it is for the extra-large houshold that is the Irish economy. It is interesting to note that in real life, you still end up doing some things for your self (that is the beauty of the power of comparative, over absolute advantage) as you would for the naitonal economy.

So spread the word. Imports are good.

[Finbar10]

Interesting post!
As you say, total energy independence is difficult. What
if we have a good summer for once and the wind simply
doesn't blow for a month or two? We'd either need a backup
alternative electricity supply (maybe some gas powered
stations we could fire up) or a vast reservoir (several month)
storage capacity.
A potential real alternative to hydro reservoir storage would
be directly converting wind electricity to hydrogen or methane.
The efficiencies of doing this at the moment aren't great, but
there has been some interesting work done lately.
Some researchers at Penn State University have come up with
a process using microbes that takes electricity and with it
combines water and CO2 to directly produce methane
(see
Bug eats electricity, farts biogas - tech - 05 April 2009 - New Scientist
Microbes turn electricity directly to methane
Direct Biological Conversion of Electrical Current into Methane by Electromethanogenesis - ACS Publications )

They were claiming high efficiencies. 80% of the original
energy was recovered when the methane was burned.
The advantage of methane over hydro storage is that vast
quantities can be stored as liquefied natural gas (LNG). Energy
can be stored at fossil fuel densities. There would
be essentially no problem in storing months or even years worth
of energy. LNG can also easily be used as fuel for transport.

....

Wind is one of the worst resources as your energy banker. Nuclear is best, followed by fossil fuels. Wind comes last because of it's unpredictability.

Wind blows stronger at night time (?), therefore you generate more energy when it's at a cheaper rate. At peak time, this is when you use your most expensive resources, therefore it's when energy is at its most expensive.

You'll still need to run off your pumped storage at peak time, regardless of weather forecasts. Because not running your pumped storage at peak time destroys your profit/loss economy. So no-one is going to leave these reservoirs full if a large high pressure is due to sit on this country for a month or two.

...

[myksav]

So I had my first meeting with an ESB employee last night, and between a few drinks and other things found the following out. Bear in mind that my memory sucks and so it's possible that what I'm stating as facts could well possibly be misinterpretations.

Let's start with the easy one, nuclear power. Apparently we can't have nuclear power in Ireland. It's in the constitution...twice (to be sure, to be sure). So if we are ever going to have nuclear power, it'll have to be through a referendum
and I don't see much chance of that happening. My source did say not to rule it out if energy bills rose to silly amounts, but don't hold your breath.

Incidentally, he also said that at one time a nuclear power plant was mooted in NI. Again, this won't happen down to how rather cheesed off the ROI government and people will be, as well as the obvious threat of terrorism.

Solar power, well just forget it. Apart from being expensive to install, the fragility of the system, and its longevity, even in the best of global warming wet dreams we won't ever be like California.

Wave energy is interesting and he'd like to know more. Unfortunately, no-one seems to be making any particularly strong case for it at the moment. I'm not sure why that is, hopefully I'll learn more from talking to the engineer.

So that leaves wind turbines. My source indicates that practically everyone is heading down this route at the moment - i.e. away from fossil fuels. It's where all the smart money is going, he personally thinks the Spirit of Ireland idea to be very practical. Not smart, because they are not advocating anything new, as in pump generated back-up, just in the manner that they are going about it. He's all keen on the construction job perspective too, which I know will be a black mark against him for some of you.

However, it is totally impossible to generate all our energy needs from wind. You'll never have enough capacity because it's a natural resource and suffers from fluctuations (unlike tidal energy). Therefore you will always have to have an alternative energy source. Most discussions here have been about the turbines not blowing over a short period of time, but you may remember that we occasionally get long hot summers here where a high pressure centre plonks over us generating sod all energy.
Yes , yes I know it's only once a decade, but from an energy management perspective, once is too much. It would cripple the economy.

So now we get to the interesting part, and that's where the inter-connectors come in. We buy and sell energy to the UK (and by extension the continent). I knew there was a connector between Ireland and Scotland, but apparently there is one already between us and Wales (?). And of course we've just got the go ahead from the EU to build this massive one between Wales and Ireland (makes 2?)

Ireland and the UK swap energy all the time. The stuff from Scotland is mostly from wind turbines and the stuff from Wales is fossil fuels and nuclear in origin.

A synopsis for us would be to create a Spirit type network with a pumped source back up for peak hours and unfavourable weather conditions. In extremis, we would use the inter-connectors to buy energy from the UK. Obviously, in extremis, this is likely to be very expensive as their own wind farms will also be down.

With favourable conditions, we export our energy back to the UK and this somewhat offsets the extremis costs. UK energy at the moment is very expensive, the Labour party have decreed that any power station past its sell by date is to be mothballed and replaced (read very expensive), a lot of these replacements are likely to be nuclear.

So the UK is going down the road of a nuclear/wind format with fossil fuel stations being phased out over time as energy sources die off. Same with France, except geographically they can't rely too much on wind.

My source informs me that the best solution is for the UK to build a humongous nuclear station in say, Stranraer, and attach a mega connector to it, just for us!

Right, I have to go to the airport now, so I'll chuck in some 'facts'

Did you know that peat generation is the most inefficient of all resources? And that the one we have is solely in case our external supplies are cut off?

Fossil fuel power stations are incredible expensive to build, as they get older they get very expensive to maintain. They do however, employ a lot of people, more as they get older.

Wind turbines are pretty cheap from a construction point of view, while they have a shorter shelf life they require little maintenance. Therefore, even taking into account construction of sea-water reservoirs, switching over to wind turbines is likely to result in large job losses in the ESB.

Carbon credits are the critical difference in costs between fossil and natural energy resources. Depending on what protocols are put in place over the next few decades, the savings on carbon credits would make converting to wind as a primary resource a large money saver for the country.

Wind is one of the worst resources as your energy banker. Nuclear is best, followed by fossil fuels. Wind comes last because of it's unpredictability.

Wind blows stronger at night time (?), therefore you generate more energy when it's at a cheaper rate. At peak time, this is when you use your most expensive resources, therefore it's when energy is at its most expensive.

You'll still need to run off your pumped storage at peak time, regardless of weather forecasts. Because not running your pumped storage at peak time destroys your profit/loss economy. So no-one is going to leave these reservoirs full if a large high pressure is due to sit on this country for a month or two.
Right, that's about all I can remember, there was a very interesting discussion about how companies sell energy to each other, how the energy market works, how contracts for differences work, but thta's for another time.

Hopefully I'll get talking to the ESB engineer later this week and find out if the Spirit proposal is practical from his perspective. But from what my mate was saying, it's feasible from a supply perspective as long as we have full support and back-up from inter-connectors.

Not checking back to edit this post as v busy, so apologies for grammar/typos

Interesting post, thanks.
Just a point of contention. In times of "no wind", high pressure cell sitting over the country, there is still wind, particularly in summer. This wind is called an onshore or offshore wind depending on time of day, onshore in evening, offshore in the morning. This wind is strongest in the evening with the temperature difference between sea and land at it's greatest.

[droghedasouth]

I think that when there is no wind available due to high pressure, it would still be possible to use imported cheap off-peak electricity from say UK nuclear to fill the reservoirs at night-time to supply peak-time electricity.

[Malbekh]

Interesting post, thanks.
Just a point of contention. In times of "no wind", high pressure cell sitting over the country, there is still wind, particularly in summer. This wind is called an onshore or offshore wind depending on time of day, onshore in evening, offshore in the morning. This wind is strongest in the evening with the temperature difference between sea and land at it's greatest.

Agreed, I hadn't thought of that! Genuinely, it's always a pleasure being corrected or informed especially when people make their points gently.

[orbit]

However, it is totally impossible to generate all our energy needs from wind. You'll never have enough capacity because it's a natural resource and suffers from fluctuations (unlike tidal energy). Therefore you will always have to have an alternative energy source. Most discussions here have been about the turbines not blowing over a short period of time, but you may remember that we occasionally get long hot summers here where a high pressure centre plonks over us generating sod all energy.

Yes , yes I know it's only once a decade, but from an energy management perspective, once is too much. It would cripple the economy.

That is a good point. As someone pointed out though, even in high pressure conditions, there is still some wind. But you do have to prepare for the worst case.

My source informs me that the best solution is for the UK to build a humongous nuclear station in say, Stranraer, and attach a mega connector to it, just for us!

Yes, a lot of people are saying that now. The argument makes some sense insofar as big countries like the UK and France can achieve huge economies of scale with their nuclear industries. But I can envisage a situation, where some of those economies could be available to us as well, through co-operation. The idea of locating a huge chunk of one country's generation capacity in an another country, sounds a lot scarier than building a nuke here, in my opinion.

[Akrasia]

Here is a follow up thought experiment.

Imagine Ireland could stop all imports (i.e. become "self sufficient"), but keep exporting the amount the country exports now. What do you think would happen to the standard of living in the country?

Well, have a look at the numbers. From 2007 accounts

Persently Ireland has total output of €200bn (let's just round and assume that you nationalised all FDI).
Exports have a value of €150bn
Imports have a value of €130bn

So under Akrasia's economic policy as the newly installed Finance Minister everyone is forced to buy carrots from local producers, along with other food, clothing, energy etc. etc.

Excellent, we "keep the money in the country" as you say. So let's revisit the numbers.

We no longer pay €130bn out for imports. Doesn't that mean total output in the country goes up to €330bn? (200+130). Well, no. There might be a little spare capacity to increase output by 65% (well, in 2007 there was zero spare capacity in Ireland). But I will be generous and say that by squeezing a little more out of the labour market and using working our capital base harder we could find another 10% of productive capacity.

There's the problem with your reasoning, upon which the rest of your figures fall apart. Under this proposal Ireland has more than enough 'spare capacity' to completely replace all our imports of fossil fuels without any opportunity cost (ie having to forego producing something else).

The financial resources required to provide this infrastructure would be more than offset by the reduction in the costs of our imported fossil fuels.

The land and people required to provide this infrastructure are lying idle at the moment.