ENERGY IS INCOME
Energy is or alone a cost or a cost plus an income for nation. Much more clear it can be said that energy makes a nation poor or rich. This can't not be seen only from historical data perspective. This historical data view misses some vital new data like strong increasing cost of exploration, reduced nett energy exploration ratios, higher refining costs due less wanted types input, huge demand rise due to emerging prosperity in the emerging markets. Regarding this energy exploration ratio issue: energy production costs have gone from 1 barrel per 73 barrel in 1971, to 1 barrel per 9 barrel in 2009. By all this structural changes future energy prices can be calculated only on historical data. The new wild cards must enter the calculation. This is something nobody wants to do, although the need for it is very clear. This historical single sided data cost price of energy perspective is what brings us in trouble. We like to be blind for the new calculation facet because seeing them is inconvenient and we think that there's no solution, so wishing has become the main component of our energy policy. The old (fossil fuel based) energy system already makes nations rich or poor. These developments only will be enforced by the above facets. The new fuel less energy system will reduce this transfer of wealth. The only reason governments don't make serious work of national energy production is that their energy advisers are working in the fossil exploring of nuclear fission industry. Domestic energy production avoids energy imports, energy imports that will be more expensive each year. Energy conservation can also been seen as income: cutting in costs that otherwise burdens households and businesses certainly can be seen as income. Energy in not only income for the large energy surplus nations like Saudi Arabia or Iran, that was in the old fossil based energy model. In the new fuel less energy model each nation can become their own energy supplier: holding the still growing energy component of the economy aboard in stead of delivering it abroad. Energy drains or build economies. Preventing future capital draining is more than income, it's recurring income, delivering commutative over the years a huge capital earning model. Energy is Income is a very valid statement.
Author: Gijs Graafland
Back to index page of Energy Economics | Energy Politics
Download the full Energy Economics report in PDF