4.06

No, I’m not waxing nostalgic for Ted Williams’ magical 1941 season (that would technically be “.406″).  I’m reading the price per gallon of heating oil on the delivery that was just made to my house.

$4.06 a gallon.  Yikes.

Energy policy, anyone?  Please??

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  1. Couple of things you can do (and might already be doing)

     * Wear a sweater at home * programmable thermostat with setback for when you're not home * if you've got wooden sash windows, make sure you use those little locks.  They're not so much to keep burglars out, but to make sure the window stays 100% closed. * make sure your door sweeps are still in good shape, to cut down on draft. * use plastic sheeting over your windows to increase their insulation * make sure your boiler is tuned * make sure your air filters are clean * if you've got radiators, make sure they're not leaking steam or hot water * if you can turn off local heat in unused rooms (vents or valves), do so

    A good energy policy won't help to bring that price down, except that it might help everyone demand a little less oil in the first place... and that's a long term policy.

    • Improve the thermal integrity of your home!

      The good news: This is generally not expensive. The bad news: It requires real expertise to do right.

      More insulation in the attic.  Blow into the walls.  These are generally easy, good payback.  The tougher stuff is really controlling all the drafts in your house- around window frames, at the wall/attic/roof junctions, etc.

      In my house, we did an addition with 2x6 construction (which increased the project cost by a 0.5% or so vs 2x4- it was truly piddling), and had it built tight.  It is absolutely frightening how much better those rooms hold heat than the rest of the house (mid 1950's construction).  We're still trying to figure out a master plan for tightening up the rest of the house (see above- not so much $, compared to fuel costs, but not easy).  

      • Do you have problem with condensation?

        One of the downsides of "building tight" is that without a draft, it's tough to equalize the humidity indoors -- and as a result, on cold days you get humidity on the inside of the windows.

        So... is it a problem for you?  Do you have a full bath in the addition to generate extra humidity?

        • Radon

          Also have to beware of unintended consequences.  Anyone ever try to track the rise of radon and other indoor air health issues with the overreactions to the 70s energy crunches?

          • Ventilation matters

            You don't want no air exchange, I agree.  

            You do want to control ventilation, so you don't get too much (bad energy-wise) or too little (potentially bad, health-wise).

            I do have a bathroom in the new addition, with a bathroom fan (which I think was required).  I don't use it all the time, especially in the winter, when a little humidity is welcome.

            We don't have condensation problems, plain and simple.  We did have a leaky water pipe problem (a contractor put a nail through a pipe, only started leaking a year later), but that's another issue!

            Indoor mold, air quality etc. are real problems.  They are no real problems with proper construction (which is more a matter of expertise than cost).

            I have some German friends who think New England is really pretty in the winter b/c of all the icicles.  They don't have many icicles on their buildings (similar climate); they aren't allowed to have buildings which lose that much heat!

    • My home's furnaces had leaks in the ductwork.

      Lots of hot air was just blowing out into my basement, where I needed it least.  Just look for gaps in the duct work and duct tape 'em closed.  

      • The real use for duct tape!

        After fixing your duct leaks, you can use the leftover tape to mend everything else.  My beloved uses it instead of masking tape or scotch tape, which makes opening gifts a real challenge at our house.

      • Don't use generic duct tape

        Yes, I know it's called duct tape, but it isn't the proper material to use on heating ducts.  It will dry out an lose its adhesion.

        There are specific products made for sealing metallic HVAC ducts.  Use that instead.  Lowes or Home Depot can direct you to the right stuff.

  2. It sucks, sorry, don't know how else to say it...

    I have a 9 month at home, plus a few others running around the house.  The thermostat can't be lowered.  You do what you can, we stay one a single floor during the day and use the zones as best as possible, close off rooms that we don't normally use.  But it's really insane.  

    The impact is just not in our homes, we're facing a shortfall in my town and the impact is going to felt within the school system.  They require an 8% increase just to match last year's budget.  Reasons include the cost to heat the schools.  The ripple effect is huge and it's one of the reasons were spiraling into a recession.  

    Leadership anyone?  Bueller?  Bueller?  

  3. 4 cords of wood ..

    4 cords of wood and its still going to be a close call this winter. And it wasnt even a particularly cold winter. I cant wait to get out in the woods and get started on this years load, as soon as the mud firms up a bit. I will go for 5 cords this year because heating oil is something we simply CAN NOT afford. Not even a possibility of that, what 1000 bucks a tank? How do people do it?

  4. Support Nuclear Power

    Heat your home through uranium.  It's environmentally sound, doesn't contribute to "Greenhouse gasses" and we can mine it here.  

    But Jimmy Carter sunk that didn't he.

    • Blame Jimmy Carter?

      Are you kidding me? The reason there are no new nuclear plants is because they're so outrageously expensive nobody wants to build them any more.

      That crazy liberal outlet The Economist says "nuclear plants are expensive to build and vulnerable to fluctuations in power prices"

      Same article also describes how expensive it is to maintain nuclear plants and that several are offline because repairing cracks in the cooling system may be cost prohibitive.

      Keeping it closer to home Business Week has this to say

      The average up-front capital cost for a new 1-gigawatt nuclear plant, sufficient power for about 1 million U.S. homes, is $2 billion to $6 billion. The cost of 1 gigawatt of geothermal and wind power is less than $2 billion; the same amount of solar power cost $5 billion to $10 billion. Never mind it can take years to bring a new nuclear power plant online; the U.S. hasn't had a new nuke plant in more than two decades.

      Strikes me that the cost/benefit ratio killed this, not Jimmy Carter.

      • Nuclear is incrediblt cost effective

        France and Japan produce millions of mega watts via nuclear.

        The Canadians are fortunate enough to produce more hydro than tey use and sell power to US grids.

        I have never understood why more "earthen homes" are not built. They obviously do have a downside, but heating and cooling them is not one of them. Properly built they are bright, airy and cost pennies to heat/cool. I tried to build one years ago but could not get a bank loan because the bank stated that the home would not be re sellable.

        • umm...

          Political Action just wrote a whole post, filled with facts and figures - and the links that go with them - discussing why nuclear technology isn't incredibly "cost effective."

          It doesn't help your cause to essentially write a post saying "uh uh!!!!!" Now, maybe you know something he doesn't, but if it's going to be a credible statement, you need to prove it - especially when he made his case with lots of evidence to support it.

          I only write this critique because I've been geniunely interested in the subject and would actually like to hear what you have to say, but it's only interesting if there's some substance to your meat.

          • So why does France so many nuke plants?

            Political Inaction cites only 2 sources.  Big deal.

            This white paper has lots of facts on the French nuclear industry.  Here are 2 which jump out at me:

          • France derives over 75% of its electricity from nuclear energy. This is due to a long-standing policy based on energy security.
          • France is the world's largest net exporter of electricity due to its very low cost of generation, and gains over EUR 3 billion per year from this.

            Whatever cost and financial drawbacks the nuclear power industry has, the French seems to have outcome them, or at least made nuclear power feasible under a broader national energy policy.

            In economics, everything happens at the margin.  As long as energy prices stay high, alternatives will be found and new technologies will be introduced.  In many ways, gasoline at $3.50 a gallon and home heating oil at $4.06 will accelerate this transition.

             

  • But what about the economics?

    My original post was centered on the economic feasibility of building new nuclear power plants. This is most definitely not my area of expertise but nothing you said diminishes the argument I put forth.

    One of the many big problems with building nuclear facilities is cost. While France produces the overwhelming majority of its electricity through nuclear power plants how did it get that way? It did so because the power company was owned by the state. (See wikipedia)

    As a result the French state-owned electric company was able to secure millions in state support as well as better loan rates as a state-run operation.

    Last I checked the USA has an entrepreurial system. Again, one of the big reasons there are no new nuclear facilities is that no corporations want to take on the expense of building nuclear facilities. They are incredibly expensive, take years to build and due to safety concerns require regular and costly maintenance.

    • Al Gore said it best

      from a speech at NYU (and repeated elsewhere), in which he said that nuclear reactors are

      expensive, take a long time to build, and only come in one size -- extra large.

      For exactly those reasons, nuclear power has failed the economic test except in centrally planned economies such as those of France or the Soviet Union. Hopes for its revival today rest on a program of massive government subsidies that would override the discipline of the marketplace.

  • I'm pro-nuclear

    but there are two big problems:

    (1) the liability barrier that Ed Markey pointed to when I talked to him about it: given we don't have a semi-state-run economy like France and Japan, whose governments can set up and manage nuclear power plants without the risks many private organizations would face in setting up here.

    and (2) this is new to me, but last week at the Museum of Science at their newish exhibit on renewable and clean energy, had a statistic on source supplies, that we only have about a 40-60 year supply of Uranium compared to 100+ years of coal supplies. I don't know the more than that but it's another important factor weighing non-renewable methods (even if they are clean)

    • I'm not anti-nuclear

      As a pragmatist, I'm rather on the fence.

      Frankly, nuclear + wind and solar + some storage work pretty well together to manage base and peak loads.  

      Coal gives us GHGs, mercury, and radiation (coal contains significant amounts of thorium and other stuff which largely goes up the stack).  Natural gas, the predominant fuel for electricity in NE, is fairly clean but faces some real supply constraints (not as much globally, though).  A lot of people aren't crazy about the safety of LNG freighters coming into NE.

      But there are all sorts of big hurdles to clear.  

      Liability and the enormous fixed costs have been mentioned.  

      Siting.  If we have problems building windmills miles from anyone's house, how are we going to site a new nuclear plant in New England?  Good luck.  

      Waste.  This is still a technical issue as well as an unresolved political issue.  Like the windmills, we can't even agree to store the waste in the middle of nowhere in Nevada?

      None of these are insurmountable.  None of them are trivial.

      • Nuclear: I am the naturaly suspicious type ...

        Call me whatever, but when it comes to nuclear power and good old capitalism, I will pass. The profit motive scares me in this application. I am reminded of Three Mile Island and Chernobyl. While it has been proven that nuclear power CAN be produced safetly, the question remains ... WILL it? There is no way I would feel comfortable in that regard as long as energy production continues as a "for profit" enterprise. When there is profit to be gouged from cutting costs, corporate entities will find a way, often without regard for the end product or with user satisfaction. We know this ... so why would we consider playing with things as potentialy hazardous to our health as nuclear power?

    • I am not a physicist but I thought $quot;breeder$quot; reactors produce more fissionable material.

  • Nuclear may be part of the solution going forward...

    but your claims are plain wrong.

    It's environmentally sound

    Isn't true.  You've got your occasional radioactive water leak, but you've also got the problem that nuclear power requires a tremendous supply of water.  You've got to get that water supply, lose oodles to evaporation/steam, and then you have to discharge much hotter water -- which has a tremendous impact on the local environment.  Additionally, you've got to mine that uranium from somewhere, which certainly has a significant local environmental impact.

    You can argue that the environmental benefits outweigh the costs, but you can't simply claim that it's sound environmentally in spite of radioactive leaks, the water usage problem [much more difficult in Southwest or, currently, Southeast USA than New England], and the hot water discharge problem.

    doesn't contribute to "Greenhouse gasses"[sic]

    Also false.  It's true that it's orders of magnitude less than coal, but the uranium has to be mined... I assure you that the heavy mining equipment isn't running on biodiesel and ethanol,  nor is the uranium transportation running carbon-free.  There's also construction and maintenance of the nuclear plant and it's equipment.

    So again, you can argue that the greenhouse gas contribution is significantly less than that of coal, and likely on the order of wind, solar, or other renewable generation -- but it ain't zero.

    we can mine it here.

    That's true, but our supplies are far from endless.  In fact, The US consumes about 27% of the total uranium consumption for electrical generation, and given that current worldwide usage is about 66,500 tU/yr and the US has about 120,000 tons in reserves, the US could supply it's current reactors without international uranium for a total of 6 years and 9 months.

    So, with no nuclear expansion using only USA uranium, we could last fewer than 7 years... rendering your "mine it here" argument technically correct but realistically useless.

    Nuclear very likely has a place in reducing total environmental impact from electrical generation within USA.  But, it's no panacea, and it certainly isn't the most efficient way to help supply meet demand at a lower price and lower environmental impact.  That, of course, is conservation.

    • environmental

      not to mention that little problem of disposing of the deadly spent fuel.  the cost of this has never been factored into the price charged for electricity generated in nuclear facilities.  rather, it has been deferred as a sort of tax on the future, mush like the funding of the war in iraq.

      • The remark on President Carter is related to that

        The waste issue would be significantly reduced (at least an order of magnitutde) if nuclear plants were allowed to reprocess their fuel, but regulations dating way back to the Carter era prevent reprocessing.  

        These regulations were intended to address nuclear proliferation concerns, but traded that for the greater waste production.

        Reprocessing could extend the life of current stocks about 60-fold, making the current 7 year stock of uranium mentioned above useful for quite some time.

        Besides, we're only 10 years away from fusion!  (We've been 10 years away from fusion for about 30 years, now.)

    • Ideology, meet facts.

      Well done, stomv.

    • Well in the meantime lets give nuclear a shot

      Because before too long we are going to be freezing in the dark.

  • i thought you despized the nanny state

    the nuclear industry had been heavily subsidized by the gov't in the past.  are you for socialized power?  then go nuclear.  it's the nanny power of the future.

  • Expensive

    We just had our first $600+ oil bill this month, and this is after we installed the programmable thermostat and put the electric heater in the baby's room.

  • Happiest Day of my life

    was closing on our new house in Duxbury end of last November knowing that we were off of heating oil and on natural gas.  Can't even fathom what costs would have been this winter on heating oil.  Have you looked into other vendors?  $4.06 seems somewhat high.  Might want to check this link out:

    http://www.massenergy.com/inde...

    Good luck and let's pray for this vaunted global warming to kick in early this year and get the furnace to finally shut off for the season.

    • Prices have spiked

      The price data page at MassEnergy (need a login, I think) shows prices going from the mid $3's to the low $4's in the past month, state average.

      The economics of radically improving the thermal integrity of one's home are much, much different today than they were a couple years ago.

      Measures with, say, a 12 year payback now have a 6 year payback, or less, at current prices.  A 6 year payback is a very competitive return on purely a financial basis, let alone the environmental and personal comfort benefits.

      Blame whomever you want for the high prices, but the underlying driver is global supply vs. global demand.  Time to really do something on the demand.

      There's more data at the EIA: http://tonto.eia.doe.gov/oog/i...

      You'll see the same spike.

      • Not entirely true about demand

        Was a little curious myself as to what has been causing the oil spikes: increased demand or the dollar falling apart?  To that end, did a little googling to find out US v. Euro rates and spot prices of oil, and then did some calculating.

        On 1/3/06, the Dollar would buy you .8444 Euros.  Average spot price of a barrel of oil was $62.31.

        On 3/3/08, the Dollar would buy you .6590 Euros.  Average spot price of a barrel of oil was $102.13.

        Oil is priced in dollars.  Converting the price per barrel into Euros gives us:

        @ 1/3/06:  63.11 x .8444 = 53.29 in Euros @ 3/3/08:  102.13 x .659 = 67.30 in Euros

        Now the price of oil in dollars over that time increased by 39.02, or 61.83% increase.

        But if we look at the price of oil on the Euro price, the percentage increase over the same time frame was 26.29%.

        And if you want to look at what the barrel price in dollars would be if the dollar was still trading at the beginning Euro conversion rate, would be

        $102.13 x .6590 / .8444 = $79.71.

        Hence, rough and ready calculations give the following:

        Total increase in time frame:  $39.82 ($102.13 - $62.31)

        Amount attributable due to dollar going down the drain: $22.42 ($102.13 - $79.71)

        Amount attributable due to real increase in price of oil (demand, political tension, etc.)

        $17.40 ($79.71 - 62.31).

        Hence, dollar's drop relative to Euro (which the oil producing countries are in essence pricing oil at, and you can't blame 'em) is a much more significant factor in the whole oil runup.  

        • Fair point

          I'm always a fan of people who use data to support their posts.

          I was thinking broadly about the sustained runup in oil prices over the last few years, but this of course has a substantial currently component as well.  

          For reference, 10 years ago, oil was trading at $10.50 a barrel (http://tonto.eia.doe.gov/dnav/pet/hist/wtotworldw.htm).

          • And remember why that happened

            LTCM and Asian currency collapse in the summer of 1998.  Can happen again (look what happened in the 80s - remember what the economy in Texas looked like after oil hit the skids?)

            • Look at the data, my friend

              I didn't cherry-pick my price.  I looked 10 years ago, to the week.  Not a strong dip at the time.

              Demand may falter and prices may drop sharply in the future.    People tend to over-extrapolate current trends, that's for sure.  But I would submit that the current run-up has been large enough and sustained enough to be... pretty concerning.

              Date            Global Spot Price Jan 07, 1994 12.37 Jan 06, 1995 16.13 Feb 24, 1995 17.13 Jan 05, 1996 18.41 Apr 12, 1996 20.81 Jan 03, 1997 23.18 Jan 10, 1997 23.84 Jan 17, 1997 22.99 Jan 24, 1997 22.05 Jan 31, 1997 21.87 Feb 07, 1997 21.56 Feb 14, 1997 20.25 Feb 21, 1997 19.78 Feb 28, 1997 18.72 Mar 07, 1997 18.54 Mar 14, 1997 18.57 Mar 21, 1997 18.81 Mar 28, 1997 18.51 Apr 04, 1997 17.62 Apr 11, 1997 16.66 Apr 18, 1997 16.59 Apr 25, 1997 16.94 May 02, 1997 17.25 May 09, 1997 17.27 May 16, 1997 18.16 May 23, 1997 18.83 May 30, 1997 18.4 Jun 06, 1997 17.69 Jun 13, 1997 16.52 Jun 20, 1997 16.57 Jun 27, 1997 16.89 Jul 04, 1997 17.39 Jul 11, 1997 16.92 Jul 18, 1997 17.13 Jul 25, 1997 17.26 Aug 01, 1997 17.68 Aug 08, 1997 17.77 Aug 15, 1997 17.44 Aug 22, 1997 17.43 Aug 29, 1997 17.08 Sep 05, 1997 17.22 Sep 12, 1997 17.13 Sep 19, 1997 17.19 Sep 26, 1997 17.61 Oct 03, 1997 18.66 Oct 10, 1997 19.34 Oct 17, 1997 18.57 Oct 24, 1997 18.51 Oct 31, 1997 18.38 Nov 07, 1997 18.25 Nov 14, 1997 18.28 Nov 21, 1997 18.07 Nov 28, 1997 17.83 Dec 05, 1997 17.01 Dec 12, 1997 16.41 Dec 19, 1997 16.04 Dec 26, 1997 15.95 Jan 02, 1998 15.21 Jan 09, 1998 14 Jan 16, 1998 13.42 Jan 23, 1998 13.33 Jan 30, 1998 13.82 Feb 06, 1998 13.38 Feb 13, 1998 12.91 Feb 20, 1998 12.51 Feb 27, 1998 11.96 Mar 06, 1998 11.81 Mar 13, 1998 10.94 Mar 20, 1998 10.5 Mar 27, 1998 12.52 Apr 03, 1998 12.39 Apr 10, 1998 11.83 Apr 17, 1998 11.94 Apr 24, 1998 12.13 May 01, 1998 12.39 May 08, 1998 12.68 May 15, 1998 12.52 May 22, 1998 12.2 May 29, 1998 12.39 Jun 05, 1998 12.11 Jun 12, 1998 11.11 Jun 19, 1998 9.91 Jun 26, 1998 10.83 Jul 03, 1998 10.82 Jul 10, 1998 10.98 Jul 17, 1998 11.11 Jul 24, 1998 11.3 Jul 31, 1998 11.7 Aug 07, 1998 11.49 Aug 14, 1998 11.02 Aug 21, 1998 11.33 Aug 28, 1998 11.53 Sep 04, 1998 11.61 Sep 11, 1998 11.78 Sep 18, 1998 11.81 Sep 25, 1998 13.06 Oct 02, 1998 13.76 Oct 09, 1998 13.01 Oct 16, 1998 12.01 Oct 23, 1998 11.5 Oct 30, 1998 12.11 Nov 06, 1998 11.79 Nov 13, 1998 11.37 Nov 20, 1998 10.61 Nov 27, 1998 10.54 Dec 04, 1998 9.48 Dec 11, 1998 9.16 Dec 18, 1998 9.59 Dec 25, 1998 9.41

              • Not disagreeing with you

                Didn't think you were cherrypicking.  The only thing that comes to my mind is back in the fall of '81 when I was a senior in college.  World was coming to an end, OPEC appeared to have a virtual stranglehold on the world's economy, plus we had the fortune of driving around in mom's Oldsmobile station wagon that got an astounding 6 mpg (think this one reason why current oil runup hasn't hurt quite as bad - back then, most of the cars in circulation got mileage that would make a Hummer dealer blush).

                Lo and behold, the political science department was holding a reception to welcome the visiting econ professor, one Charles Poor Kindleberger, author of the tome "Manias, Panics, and Crashes" (worthwhile reading BTW).  Charlie proceeded to gore about every sacred cow held by the Middlebury poli sci department.  To us, his predictions sounded like they had about as much chance of coming true as pigs flying.  Check back about 2 years later, and OPEC was broken, with oil prices plummeting.  This had the unfortunate effect of wiping out the US oil industry, as prices then in effect were lower than the cost of production. Not saying that this current runup will have the same outcome; but does give one pause (or hope, as the case may be).

                • Got it.

                  Actually, Paul Krugman has an interesting theory on why oil prices were high in the 70's (and now) that has less to do with OPEC's market control (which was never that strong), than a weird dynamic equilibrium where when prices are really high, producing countries are generating more cash than they can effectively spend/invest, so they have no incentive to increase production (the oil is worth more in the ground).  

                  Yes, oil and natural gas prices could drop a lot, I agree.  Or not!

                • A few things are different today than the 80's oil glut...

                  As I understand it, OPEC inadverently started the glut when they realized the global recession of 1980 ultimately hurt their long-term interests when their customers bought less oil--hence they increase production to "stabilize" pricing.

                  Today the demand is far greater with China and India at the table.  Also, with another 30 more years of pumping oil, some fairly smart people are suggesting that many large oil fields are approaching their peak.

                  Finally, we've got the global warming crowd.  I'm not smart enough to say it's caused by CO2...but CO2 does trap heat and CO2 is an emission from fossil fuel...so better safe than sorry and it's time to get off oil.

                  All those factors convince me that we in for long term high energy prices.  

    • Deluxbury!!! Wow !!

      When I first bought my house---early seventies---I had an old ark of a oil burner and everything else was electric. Then came the blizzard of 1978. No power for over one week= no heat or anything else for that matter. Converted entire heating system to natural gas, as well as kitchen stove and hot water heater. Thank god I had already put in a wood stove and had five cord of wood on hand.I also went out and purchased eight hurricane lamps.

      Now if I lose all power I still have heat and light and it's two thirds to one half of oil.

      The Brits have "demand" systems for hot water that save lots of money and energy and my brother just put in a water storage tank for his forced hot water system that works wonders and you can hook that into solar as well.

      • Believe it or not,

        more affordable than what we could get by far nearer to Boston.  The price you pay for slogging up Route 3 everyday...

      • Water storage

        Very efficient.  Mine is 850 gallons and wood or propane fired.  Theoretically could hook it up to solar.

        • What is it?

          Gary, what am I looking at?  A water storage tank?  A heated water storage tank?

          Have more details?

          • A simple innovative system

            The furnace--blue thing on the left--is dual fuel:  wood or propane.  You could also go with wood or oil, wood or natural gas.

            It's a TARM, but there are other companies out there that make wood add-ons that you can add to your existing oil or propane furnace.

            The principle is this: 1) once you start a wood fire, it's more efficient to burn it completely to ash in a low oxygen environment, and 2) you have to put the heat from that wood somewhere, and water is the best place to efficiently hold it.  

            The larger the container, the more efficient, but space is an issue.

            I fire the TARM with a load of wood, that heats the 850 gallon water tank (eventually) up to a max of 175 degrees. Then, as the house needs heat, or hot water, heat exchangers in the tank circulate the hot water up to the air handlers or hot water faucets.

            If the wood fire goes out, the gas kicks.

            No question that wood is the cheapest fuel source, but with the obvious drawbacks that it's dirty plus it's a lot of work.

  • A double-edged sword

    Not only has the Iraq war driven up the price of oil, it is done at a time when loose money devalues the dollars used to buy it.  Would you feel any better if you converted the price to Euros - I expect it would be more like 2.62/gal.

    To see how Bush has succeeded as an oilman: http://www.oilnergy.com/1heato...  

  • Heating oil price has diverged from gasoline.

    Typically, heating oil has been a bit below the price of a gallon of gasoline.

    Just wait till Memorial Day.

    • Heating oil is essentially kerosene/diesel

      diesel is skyrocketing because of most of Europe uses diesel in their motor vehicles , so you get back to supply and demand.

      The fact that there have been zero refineries built in USA incredibly exacerbates the issue. For the first time ever, USA has begun importing REFINED gasoline. It;s one of the freedoms of living in USA. We have the freedom to screw ourselves into energy led destitution. We and our big cars and all that crap.

      • Refineries.

        I don't claim any special knowledge about this, but my understanding is that the US refinery capacity has been shaped as much by market forces as by regulation and NIMBY attitudes.

        IE, perhaps we might as well import refined product, if we're going to import the petroleum at all.

        I do think demand side management is the only real long term solution.  Reading a WSJ editorial a few weeks ago, an oil bull's best case was that the pessimists might be wrong by as much as 50 years.  From an inside the industry perspective, that probably seems like a big deal (and is), but from the perspective of human history, efficient end use of available resources seems to be the only hope.

      • Refinery Myth

        As MassParent alludes to...the zero refineries not being built in the US as a reason for shortages is total BS.  

        Because the oil industry has a vertical hold on the supply chain, they squeeze the refinery costs to razor thin margins, making profits on the pumping of oil.  So in the US, oil refineries have been closing and existing ones expanding--making them more profitable.  Like manufacturing, refining has moved oversees becuase it's cheaper.  

        Now I'm sure you're going to contend it's cheaper because all the tree huggers amade it tougher to build more refineries.  If that was the case, can you explain why operating refineries have decreased since 1981 from 324 to 148?  It's not the tree huggers that did it, but the capitialist.

        • It's the Executives at the Oil Companies.

          NOW did a story on it in 2005.  Turns out even Pat Robertson wanted to buy a refinery they were shutting down, but they wouldn't sell it to him.  Pat's argument was that if we kept shutting down refineries, we'd have $3.00 a gallon gasoline.

  • Guess I did pretty good...

    Yesterday they charged me $3.79 a gallon (after the pay within 5 dya discount).

  • Policy?

    The do-it-yourself suggestions are spot on, but not a policy. (Unless "everybody go buy some caulk" is the policy.)

    One framework for a smart energy policy might be that of economic efficiency. A second part of that is a regulated utility that provides energy efficiency in all spheres.

    We New Englanders waste an astonishing amount of energy, where "waste" is measured in terms of avoided costs. For instance, if insulation costing X could save you heating costs greater than X, you are wasting energy (and money) by not insulating.

    The astonishing amount of waste is even more so once environmental costs are added in (not captured, David, even by your $4.05 per gallon).

    The interesting thing is that by and large people are not wasting energy because they are bad or stupid--they are often behaving in economically rational ways. I might save a bundle in heating bills if I insulate, but if I rent my place, I'd be improving someone else's property (and might have to move before I recoup my investment). If I'm the landlord, I only see savings if heat is included in the lease.

    There are many such inefficiencies, subsidies, and market barriers built into the way we do things. However, a model exists to overcome market barriers, in the energy-efficiency programs of regulated public utilities. The folks that give rebates on CFLs and provide free energy audits (and also do serious work with commercial and industrial customers).

    These programs are far from perfect or comprehensive--no heating incentives for you David, unless you switch to gas--but they do point the way to a set of programs that seek to capture all cost-effective energy savings.

    Cost effective just means that if an energy-saving measure costs less than the energy that is saved, you do it. Count all costs, including environmental externalities, for good measure.

    The most advanced of the utility programs is that of Vermont, which periodically puts out to bid the job of providing energy efficiency to Vermont residents and businesses. The current contractor is an outfit called Efficiency Vermont, a nonprofit that is in effect Vermont's energy-efficiency utility.

    Efficiency Vermont is still limited in scope: its mandate extends only to electricity and gas, and its budget is capped short of all cost-effective energy savings that are available in Vermont.

    Still, if you are looking for policy, how about leapfrogging Vermont's achievement with an efficiency utility that (a) goes after inefficiency in all sectors, not just gas & electricity, and (b) gets all the cost-effective efficiency there is to be had?

    Caulk and insulation may be a good individual response, but comprehensive "caulking" in every sphere is a good policy.

  • A little late for this year but

    It's little late for this year but lock in the price next year!  

  • Point of view.

    Is the price of fuel rising or the value of our currency falling?  When commodities prices rise in unison, it is the value of the currency that should be questioned.  This period in time reminds me of the Vietnam inspired price inflation of the '70s.  The Fed prints money as fast as it can, the government spends as fast as it can and the average citizen will be expected to do the bailout at some future time. Imagine a really big Ponzi scheme.  The last one to hold the bag loses.

    What is most amazing is that the public generally accepts what is going on.  Not having learned from the past, we repeat it.  

    At the very least the ethanol mandate (read fiasco) should be repealed as soon as possible. It exacerbates the situation by increasing the costs of the foods we eat and the effects of this program will take many years to resolve.  Which candidate has mentioned that?

    We're doomed...

    • Commodities

      also respond to demand.  India and China are growing rapidly.  So the cost can go up for various commodities almost in unison, without it necessarily being linked to currency devaluation.

      In the case of the US dollar, though, we've been printing money like it was going out of style all through the Bush years, while borrowing boatloads more from abroad.  THe roosters are coming home, and by gosh, if you've never been chased around the yard by a rooster, it's an unusual experience.

  • Why is the price continuing to rise?

    Wow, I was gagging over 3.83 per gallon.  On January 30th, I paid $3.21.  Why does the price continue to rise.  Why is heating oil more expensive than gasoline?  The conservation information  is great, but everyone I talk to is already keeping their homes just above shivering.  

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