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It talks about Tesla, but I'm not really sure how much oil prices can really decline. I would be more worried about SolarCity and solar in general. Trump says h

• hx87 10y ago
  Natural gas would have to be really cheap in order to beat spot prices for solar on sunny days, especially in the southwest. It's still good for peaker plants though. Coal, on the other hand, I don't see being profitable unless Congress starts taxing solar directly, since it still can't beat solar spot prices and it's categorically unprofitable to run coal plants as peakers.
  • JoeAltmaier 10y ago
    If we harvest Methane Hydrate deposits undersea and pipe them into coastal cities, then natural gas could become essentially free. That would be hard to beat.
    • hx87 10y ago
      The capital costs though...and if you ignore capital costs, sunshine is free.
      • JoeAltmaier 10y ago
        They're huge and convenient. Capital costs paid once; gas flows for centuries. It'll amortize to almost nothing.
    • ajross 10y ago
      You have a cite for that? Gas is extraordinarily transportable already. If this were true, we'd be sucking those deposits already and shipping or pipelining the LNG already.
      • JoeAltmaier 10y ago
        Just discovered and mapped. Japan is harvesting them.
    • acchow 10y ago
      Under your definition of "free", aren't current forms of natural gas "free"? Or any other form of hydrocarbon mining?
      • JoeAltmaier 10y ago
        These deposits happen to be freakishly convenient (offshore coastal cities) and the technology to harvest is ready (offshore drilling). Also they are essentially endless (centuries of supply). Its like they were planted there to tempt us.
  • rgbrenner 10y ago
    Coal, on the other hand, I don't see being profitable I was looking up the numbers.. and was happy to see renewables cost being lower. But take a look at this 2015 report from the EIA: http://www.eia.gov/forecasts/archive/aeo15/pdf/electricity_generation_2015.pdf http://www.eia.gov/forecasts/archive/aeo15/pdf/electricity_g... At the time at least, "clean coal" is more expensive than solar.. but if you eliminated the carbon capture requirement (ie: "conventional coal"), it significantly reduces the price, bringing it in under solar. There is a 2016 version of this report.. but it gets rid of the conventional coal costs, because regulation prevents plants without carbon capture from being built. http://www.eia.gov/forecasts/aeo/pdf/electricity_generation.pdf http://www.eia.gov/forecasts/aeo/pdf/electricity_generation....
    • toomuchtodo 10y ago
      Coal does not compete against renewables, it competes against combined cycle natural gas plants. Natural gas pushes the rest of coal out, with the benefit of being lower carbon impact and has the ability to throttle quicker before the evening peak when solar generation recedes. Wind and solar will of course continue to come down in cost, pushing out natural gas, with battery storage replacing the last of natural gas eventually.
      • rgbrenner 10y ago
        Coal does not compete against renewables, it competes against combined cycle natural gas plants. According to the 2016 report, it's tax credits that brings solar PV within 5% of combined cycle plants. Without the credits it's 33% more expensive. (And this is for plants entering service in 2022.)
        • toomuchtodo 10y ago
          Maybe I'm missing your argument? I'm arguing moving to natural gas is a win regardless, even if it takes longer for the cost of solar to come down.
          • 10y ago
• k8t 10y ago
  I agree. Tesla's whole philosophy, I think, was to get people to buy their cars simply because it's a better car, not for any environmental reasons. Oil prices will affect them, but can't destroy them
  • chronic6l 10y ago
    Oh, come on. A major reason people buy Tesla vehicles because they "want to do their part" for the environment.
    • gph 10y ago
      Yea, but those folks won't change their behavior. If anything they will probably be more encouraged to do more. I think what OP is getting at is that Tesla isn't aiming for just that demographic. Musk has always wanted to produce his cars so that they are desirable to everyone.
      • goshx 10y ago
        Tesla needs to make desirable cars because otherwise the environmental reason alone is not sufficient for more people to make the move. Musk's goal is to get more people to use sustainable energy.
    • erikpukinskis 10y ago
      Yes, true! But that's not the goal. The goal is the Model 3, which should have an industry leading TCO per mile, below the Prius, Honda Fit, etc. Tesla has been explicitly thanking current buyers of Model S and Model X for doing their part providing cash for this environmentalist project. Elon's earliest statements admit that they can't compete on price as a startup. But they have been driving costs down rapidly and their philosophy as OP stated, is to be the best car available in all senses, and not rely on environmentalist good vibes for sales. They already did this for acceleration, automation, and running costs. They still have some categories to go. But that doesn't invalidate the suggestion that their philosophy is about feature parity, as opposed to environmental charity.
    • 10y ago
• piotrjurkiewicz 10y ago
  > Trump says he wants to expand coal, nat gas, etc.. and cheaper prices for those would discourage new solar installations. This is completely illogical. Increased usage of coal or gas will result in higher prices of those resources, not lower. In addition, switching back to coal and gas as electrical power sources means lower energy costs. Lower energy costs mean lower manufacturing costs, what will finally result in lower electric car/batteries and solar panels production costs. Lower electricity costs will also result in lower operational costs of electric cars.
  • _fizz_buzz_ 10y ago
    He wants to increase supply, which will lower prices.
    • piotrjurkiewicz 10y ago
      This makes rest of my statement even more true (lower resources costs -> cheaper electricity -> cheaper manufacturing of electric vehicles -> better business for Tesla). All they need to do is keep being focused on their primary business, instead buying SolarCity.
      • yessql 10y ago
        Electricity is basically free compared to gasoline. If you cut the price of electricity in half, it wouldn't move the needle at all on EV sales.
        • piotrjurkiewicz 10y ago
          Energy used for production of electric cars/batteries (or any other thing manufactured in modern factories) isn't made from gasoline...
        • vonmoltke 10y ago
          It's significantly cheaper, but it is far from free (unless you are actually not paying for it). Even at a generous $0.10/kWh a Tesla costs about $0.029/mile. At $2.20/gallon, a 30MPG cat costs about $0.073/mile.
• drzaiusapelord 10y ago
  Tesla and its customers enjoy a fair bit of subsidies. According to the LA Times that number is around $5bn. Trump has stated he wants to cut these types of subsidies and others for renewables as part of his belief that climate change is a "Chinese hoax." I think Elon has a right to worry here as his products are probably too expensive without these subsidies. Even the Model 3 is pricey without that $7,500 tax break. Probably bad news for the Lead and Bolt as well.
  • mikeash 10y ago
    The Model 3 is going to blow through those subsidies within a year of shipping. They're only available for a limited number of cars, then they go away. Tesla clearly thinks that they're viable without the tax credit.
    • yessql 10y ago
      Yes, this is important. Tesla could blow through all of the credits in 2018. Tesla could technically benefit from the EV tax credit being cancelled after that, since its products would no longer qualify, but the other OEMs that have sat on the sidelines waiting for cheaper batteries would not be able to jump in and take advantage of having a subsidy available to them, but not to Tesla, Nissan, and GM that would have used up their credits. The design of the EV tax credit is really bad.
      • mikeash 10y ago
        The benefit to competitors would be limited, since as soon as they created a product that sold in high volumes, they'd use up their subsidy too.
  • caseysoftware 10y ago
    Isn't getting rid of corporate welfare a good thing?
    • kd0amg 10y ago
• cossatot 10y ago
  I think the talk of expanding coal production in particular was mostly talk aimed at a segment of the electorate (although I haven't followed Trump closely enough to realize the extent to which he realizes this). The demise of Appalachian coal was mostly due to the rise of both natural gas and Wyoming coal, as well as exhaustion of readily available resources. Though Appalachian coal is higher grade, it requires expensive and dangerous mining practices such as room and pillar mining, mountaintop removal, or more traditional practices in increasingly small and geometrically complicated seams. The coal from Wyoming is basically at the surface and can be strip mined at scale very cheaply, with lots of automation. Unconventional oil and gas production is also at odds with coal production. As you've said, oil can't get that much cheaper, and gas is pretty similar, and has more substitution with coal. Many of the restrictions on unconventional production (i.e. fracking regulations) are done at the state level, and given the concern over recent seismicity in associated with injection of post-fracking wastewater, the states probably won't budge that much. If as pro-oil a state agency as the Oklahoma Corporation Commission (the main regulatory agency in OK) is tamping down on production processes, there is very little a Trump administration can do to shift the needle. Similarly, we (he) won't be able to simply deregulate and re-invigorate mining. Too much of the demand is based in China, and a trade war there will simply depress prices further. Additionally, many of the resources are in states that are not overly favorable to Trump, and the state EPAs have a lot of sway, especially in a more 'states rights' environment. Rare Earths, for example, are mostly found in the US near Las Vegas but across the state line in Mountain Pass, California. And NV isn't as red as it used to be either. Lithium production could increase, but I think the problems there are there just aren't a lot of good sources, not environmental regulations. Lithium is tied up with salts or brine (salty water) from hypersaline lakes that dried up and concentrated metals that were already especially abundant due to particular geology. Lithium mining is often just pumping salty water out of aquifers or dredging it from lakeshores. It's not like copper or gold mining/processing that involves nasties like mercury and arsenic. Trump's policies will probably mostly involve somewhat symbolic, macroeconomically insignificant, and locally damaging exploitation of currently off-limits areas like ANWR, offshore CA and the east coast, and possibly many of the new national monuments in the West that may have uranium or other metals. Eliminating the tax incentives for renewables is also likely, but may not yield as much permanent damage as environmental degradation; some companies may lose market share or capitalization, some may bust, but this won't turn the tide.
• mbostleman 10y ago
  Agreed. But ironically the biggest pressure on solar now (and in the last 5 years) is price manipulation by China - something he promises to fight (though not necessarily for the sake of green tech).
• jsight 10y ago
  I think that the lack of competition for consumers in the energy sector will reduce the impact on solar. I don't expect utility companies to necessarily pass along their savings (if there are any) to consumers.
• f_allwein 10y ago
  Interestingly, much the same thing happened in Germany in 2010 - a new chancellor called Merkel decided to revise her predecessor's decision to exit nuclear power. This led to massive phobic protests and upheaval among green energy companies. The decision was only revised after Fukushima, some 6 months later. https://www.theguardian.com/world/2010/sep/06/germany-extend-nuclear-power-stations https://www.theguardian.com/world/2010/sep/06/germany-extend...
• Steel_Phoenix 10y ago
  The US, under Obama, has nearly doubled our oil production, largely through fracking, to the point where we are now producing more than we use, and also lifted the ban on exports. We're not in the business of trying to make oil cheaper anymore. Fracking is an expensive way to get oil (compared to drilling), and we're near the break even price. The Saudis, who have been manipulating our politics for years by threatening to cut production to raise prices, have now started flooding the market with cheap oil in an effort to starve out both our fracking and our emerging electric car market. Our response has been to pass a law making foreign nations liable for damages caused by their involvement in terrorism committed on US soil, and declassifying the 9-11 report, which shows enough Saudi involvement to open the door for a lawsuit. Considering how much they have in US assets, this could potentially be collected on. It's a threat. We're trying to pressure them into ending their flood of the market so prices will rise. The Saudis know it and have threatened to drop a trillion in US debt and holdings. Say what you want about Trump's social issues, but he understands this kind of game. He's not going to expand a US product that is struggling to break even with intent to lower the sale price. He'll continue pressuring the Saudis to drop their production, oil prices will rise, and it will benefit both the US oil industry, and Elon Musk.