California Has a Plan to End the Auto Industry as We Know It

It seems to me that an alternate explanation could be that it took auto makers 10–20 years to figure out how to build good compliant cars, with their first tries sucking, but once the regulatory regime had been stable for a while they figured out how to make big improvements. In a counterfactual world without those requirements they might be much more polluting today. [I dunno, I’m not at all an expert in this subject, I’m just speculating.]

At any rate, as someone who grew up in the 90s in southern CA, I’m very thankful that emissions of cars made in the 80s/90s were much better than cars 20 years prior; cleaner cars were a big part of the radical drop in air pollution throughout the area.

Almost all solar power is heavily subsidized by the government, and is still more costly than its worth:

"In spite of government’s best efforts to encourage innovation by solar energy companies and encourage Americans to rely more heavily on solar electricity, solar power continues to be a losing proposition. American taxpayers spent an average of $39 billion a year over the past 5 years financing grants, subsidizing tax credits, guaranteeing loans, bailing out failed solar energy boondoggles and otherwise underwriting every idea under the sun to make solar energy cheaper and more popular. But none of it has worked. Solar energy remains prohibitively expensive – often three times more than electricity produced from natural gas or other sources. As a result, less than 1 percent of the electricity consumers by Americans comes from solar energy sources."[0]

Solar has a cost problem and an intermittency problem: "At first glance, it looks like [photovoltaics (PV)] could be competitive with coal or natural gas plants if the PV cost were to drop below 10 cents/kWh. But there is an important difference between PV and the traditional technologies which makes this simple cost comparison invalid.

But first, take a look at the cost of electricity from a coal plant. The total cost is projected to be 9.5 cents/kWh per the [U.S. Energy Information Administration (EIA)] study. About 6.5 cents of this is capital cost and about 2.5 cents is the cost of the coal. Looking at the natural gas plant, one can see the capital cost is about 2 cents, and the fuel cost is about 4.5 cents.

Solar has no fuel cost element but significant capital investment.

But here is the rub. If you plan to power a city with PV, it is not sufficient to simply build a large PV array, because PV only produces power during the day. At night and during cloudy weather, a back-up power source is needed since there is no practical way to store the PV energy.

So the city must also build a conventional coal or gas plant, which will sit idle on many sunny days. The real cost of the PV is not just its cost, but also the cost of the back-up plant. Coal and natural gas plants do not need back-up like PV does.

So what is the real value of PV? It is principally the fuel savings which occur when the traditional plant can reduce output during sunny days. Or stated another way, PV is worth avoided fuel cost. The main point is that PV is not competing against the LCOE of coal or natural gas plants; it is competing against the variable operating cost of these plants, which is 2-4.5 cents."[1]

Solar is fine for heating your pool or providing a little energy on sunny days, but if I'm on the operating table, there's not a snowball's chance in hell I want the doctors to be relying on solar power without a fossil fuel backup.

Wind power is also very costly. It requires a lot of the rare earth mining I cited earlier and kills an est. 234,000 birds per year in the U.S. alone.[2]

My point is that there are negative externalities associated with all types of energy production; I don't have any problem allowing new forms of energy to compete for adoption. But competition does not mean taking a superior form of energy production (oil, gas, nuclear, hydro) and artificially inflating the price through regulatory policy[3] so that inferior forms of energy production (solar, wind) may become "viable" on a large scale. Undo the bad law/regulation which shackles nuclear, fossil fuels, and hydro (outside of some basic stuff like the catalytic converter), stop subsidizing wind and solar (and oil as well), and let them compete!

I keep coming back to this: cheap, reliable, portable, plentiful energy is what makes modern life possible---the more we can rely on machines to do the back-breaking work humans used to do, the better. The more energy a society uses, the wealthier and healthier its citizenry. As the name of that site I cited suggests, (fossil fuel, hydro, nuclear) energy production is the Master Resource from which all else is possible in a modern economy.

Regarding your last point, you cannot say on one hand that it is a "dynamically changing market" and car companies simply need to adapt, while acknowledging in the same breath that government regulatory policy has placed these undue burdens upon the companies in the first place! It's like California creating the conditions for fuel costs to rise, and then blaming the oil companies! Let's see it in action:

"Based on an Air Resources Board analysis, the Western States Petroleum Association last year extrapolated that cap and trade would add 16 cents to 76 cents a gallon to the retail price of gas. Other economists projected a 10-cent bump. Sure enough, gas prices skyrocketed this year, though it’s tough to disentangle the impact of cap and trade from other ill-conceived environmental policies.

State and federal environmental mandates have forced several smaller, inefficient refineries in California to shut down over the past two decades. Only 14 refineries in California produce the state’s pristine-burning fuel, and most operate at nearly full capacity to stay cost-effective. Few refiners outside the state blend California’s reformulated fuel.

In most of the country, a problem at one refinery won’t significantly affect retail gas prices. But in California, when one refinery shuts down, others can’t pick up the slack. And it can take weeks to import refined fuel by tanker. In the meantime, customers are stuck paying higher prices.

Hence this year’s price swoon. Following an explosion at an Exxon Mobil refinery in Torrance, and a labor stoppage at a Tesoro plant in Martinez this winter, gasoline prices rose nearly a dollar. Eventually, imported oil helped cover the supply-demand gap. But recently a Tesoro refinery in Carson reduced its output to perform annual maintenance, which has again stretched supply in the Southern California market.

In May Democratic state legislators held hearings to “investigate” the gas price spike. San Francisco hedge-fund grandee Tom Steyer has demanded subpoenas of oil-industry executives.

“As everyone knows, the oil companies have been charging Californians up to $1 billion per month more for gasoline than if we paid the national average,” the billionaire environmentalist asserted. “It’s time to put an end to the Big Oil giveaway.”"[4]

What I have done so far is offered an overview of a contrary position, which is basically a riff on this book: http://www.amazon.com/Moral-Case-Fossil-Fuels-ebook/dp/B00IN.... I would recommend it to anyone interested in the other side of the debate.

[0]https://www.masterresource.org/solar-power-issues/government... [1]https://www.masterresource.org/solar-power/solar-power-cost-... [2]https://en.wikipedia.org/wiki/Environmental_impact_of_wind_p... [3]http://www2.epa.gov/cleanpowerplan/clean-power-plan-existing... [4]http://www.wsj.com/articles/sky-high-california-gas-prices-h...