Some Christmas Reading

Pat Swords has written a new book, available to download from the link here :

Feedback from: Pat Swords (europa.eu) 

Having lived and worked in many places that have been in the headlines in recent times such as Ukraine, Sweden and Libya, Pat is in a unique position to explain events that have unfolded in recent times.  

"Colonel John Boyd of the United States Air Force (USAF), who as a jet fighter pilot in Korean and Vietnam eras, had also a standing bet as an instructor pilot, that beginning from a position of disadvantage in air combat manoeuvring, in less than 40 seconds, he could defeat any opposing pilot. He also invented the OODA loop, which is not as one would expect, about twisting a fighter aircraft into some contortionist position, but rather stands for a strategy of ‘Observe – Orient – Decide – Act’. Namely, prior to making a decision (the decide phase), the person will first have to get information (observe) and determine what it means to him and what he can do about it (orient). Which in turn leads to the good summary of, fail to ‘observe’ (get the information), prepare to fail. Jim Glennon, who served seven years in the Oireachtas as a TD (Member of the Irish Parliament) and Senator before retiring in 2007, wrote in the Irish Times on the 1 April 2010: 

“Most voters are, somewhat naively, of the view that government policy is developed through a process of careful analysis, comprehensive consultation, and the selection and prioritisation of initiatives based on impact and thorough cost-benefit analysis. In reality, most government policy-making is based on an ad-hoc reaction to events / media-pressure, and driven by the responsible Minister’s particular requirement to be seen to announce something which seems at least semi-sensible.  Regrettably, policy-making which is focused solely on addressing tactical issues inevitably leads to strategic mistakes. Many of the problems now being faced by the Government are the result of ad-hoc fixes of problems during the boom – got a problem, create an agency, buy-off the unions, get it off the front page”. 

You would think that they would learn from this and put in a more effective strategy, such as a few OODA loops.

As hindsight is not foresight, there are always decisions with results, which don’t match the prior hypothesis. However, does that mean we should hand over our decision-making to those designated for us as ‘experts’, particular so when it is us, who rightly or wrongly, bear the consequences? This is a very fundamental question. For example, there was quite a mess left behind the Iron Curtain by the planned economy, even though its superiority was taught and eulogised by the local economic professors, before they themselves saw the light and re-educated themselves, when the wall fell down. Making people clean up the mess they leave behind is always difficult, because it seems nobody is responsible, as all are responsible, even though it was only nobody and his buddies, who got to make the decisions, Hence, the conclusion of the ‘five whys’ analysis, was that pretty strong checks and balances must be put in place, to control nobody and his buddies, by all the rest. Which in legal terms led to the adoption of the UNECE Aarhus Convention on the premise that the environment is important and does not belong to the State, but to the people, and as political ideologies come and go, the people must be provided with robust procedural rights in relation to environmental decision-making".

Energy Crisis - Part Two Electricity Bills

Three ways Electricity bills could be made more affordable:

1)   Most wind farms in Ireland are (hypocritically) profiting from the current higher gas prices (Weren't renewables supposed to do away with expensive dirty fossil fuels?). When gas prices were low in 2014 and 2015, wind farms were getting the gas price plus a top up to a fixed price. Now when gas prices are far exceeding this fixed price, they are receiving the massive surplus. So it is a lose - lose situation for the consumer. It is an arrangement that is indicative of the parasitic nature of wind energy which can only be accommodated in a grid dominated by fossil fuel or hydro generation. 

This win-win arrangement for wind energy could be reversed so that wind farms only receive the fixed price originally intended or if that is not legally possible, the excess profits taxed at a special rate and handed back to the consumer in the form of reduced electricity bills.

2)  Time to pass on those savings - when gas prices were low in 2014/15, hardly any of the fall in prices was passed on to consumers. See the following newspaper articles :

2015 - "most firms are dragging their heels in passing on recent falls in wholesale gas and electricity prices to consumers".

Make some electric savings by changing energy supplier - Independent.ie

2015 -  "Irish consumers pay the fourth-highest energy bills in Europe, according to EU statistics. Little of the large recent falls in wholesale gas and oil prices have been passed on to consumers".

Airtricity was paid €32m to run power station for just 50 hours - Independent.ie

Not for the first time in Ireland, a Regulator failed to do their job. Pressure could be put on the energy companies to pass on that saving now, in particular, ESB which is semi state. Failing that, a special tax could be introduced which would be based on the pro rata decrease in gas prices over that period seven years ago.  So if gas prices fell by 20% over one year back then, then corporate taxes on energy companies could be increased from 12.5% to 15% with the additional taxes passed on to consumers of course. This would provide some justification for the tax, rather than simply hitting the energy industry with an arbitrary tax. 

 3) And of course, cancelling all carbon taxes would reduce the cost of all types of energy.

Inflation : Irish Energy Blog proven correct, Major Economists Wrong

Last October, I wrote an article predicting that inflation would not be temporary :

Irish Energy Blog: Why Inflation will not be Temporary

Almost every other major economist at the time was predicting that inflation would be temporary or "transitory" :

"The European Central Bank still sees a recent rise in euro zone inflation to above its 2% target as temporary and expects price pressures to ease next year, ECB President Christine Lagarde said on Thursday"  [Oct 21].

"Inflation "is expected to dissipate over time, as supply disruption eases, global demand rebalances, and energy prices stop rising," with a peak likely in April next year, the BoE said in an announcement in which it vowed to train its eye on "medium-term prospects for inflation" and ignore "factors that are likely to be transient."    [Nov 21]

Jan 22 :

"The word "transitory" seems to be gone from the lexicon but European Central Bank (ECB) chief economist Philip Lane is sticking to his guns, insisting the current burst of inflation is merely a temporary Covid phenomenon that will peel away later this year".

It appears that the people who's job it is to understand inflation do not understand it. In very simple terms, this is how it works :

Inflation is too much money chasing too few goods. 

It does not matter the cause of supply shortages. 

You must not increase the money supply during supply or production shortages.  

If a country has four production facilities and three close down, then printing money will cause a surge in inflation because the money supply has increased when production supply has decreased in this case by 75%. The monetary policy was the opposite of what needed to happen. 

It does not matter the reason for the three plant closures - bad weather, pandemic, war, fuel shortage, aliens etc - the effect is the same, viz, a reduction in production. 

Yet, this is exactly what economies all across the world did during the Covid lockdowns - they printed massive quantities of money during a period of very low output (and low interest rates). While the lockdowns were destructive in themselves, printing money simultaneously was like throwing petrol on the fire and for that reason I don't see an end to the inflation crisis for quite a few years. 

Energy Crisis - Part One Lessons from the Past

    During the 1970s, when the last serious energy crisis occurred, the Irish government and ESB, free from almost any ideological constraints, drew up plans for the single largest construction undertaking in the history of Ireland - Moneypoint coal power station.  It was a huge success and the power station is still managing to keep the lights on during the current energy crisis despite being a target for destruction by the ideologues that swarm Leinster House today. 

Ideologue - various definitions given :

 - an adherent of an ideology, especially one who is uncompromising and dogmatic.

 - an often blindly partisan advocate or adherent of a particular ideology

 - an impractical idealist

 - An ideologue is someone who has very strong beliefs or opinions and stubbornly sticks to them no matter what. An ideologue will insist they're right even when evidence suggests they might be wrong.

The roots of the modern ideological movement began back then in the anti- nuclear movement. It could be argued that man has a natural aversion to nuclear power arising from fear of the unknown. It is of course still a relatively modern technology. But man has no natural aversion to coal. Indeed, the inhabitants of Ireland have been burning coal for thousands of years. In the 1770s, an ancient coal mine was discovered in Antrim. The antique mining tools found there disintegrated as soon as they were touched.  It is only very recently in human history and after years of relentless propaganda that man has decided he wants to turn his back on coal even though it is proving more difficult than he first thought. 

It is not so much misinformation that is causing an unnatural fear of coal, but lack of balance and maturity in the judgement of those at the driving seat of the new ideology. For example, eating your lunch carries with it the risk of choking, but we all accept that risk for the benefits associated with satisfying your hunger. However, if we were to just focus on the negatives and ignore any positives, then the risk of choking is no longer acceptable and therefore eating must be outlawed as an antiquated pastime no longer acceptable in a modern progressive society. Afterall, choking is one of the leading causes of unintentional deaths every year.  

So this is the big difference between the 1970s and the 2020s - for ideological reasons we can't build another Moneypoint power station. Nuclear was ruled out then and is still ruled out now. Let's add coal to the black list.  What can go wrong ?

This leaves us with gas power. But surely it would be foolish to build more gas power stations when high gas prices and the uncertainty of gas supply are the root causes of the current energy crisis ?   For the ideologues who become increasingly divorced from reality, this is not a problem. Gas is good, at least for now (except of course if it's LNG / Liquified Gas that can be shipped in in an emergency situation where the UK can't supply piped gas), coal is bad goes the diktat and the economists and media pundits, one after the other, fall in line. But for the gas generators contracted to build the new power stations, reality is not something they can ignore, and they are pulling out of the Irish market, one after the other. 

Since energy production is a long term enterprise (Moneypoint wasnt up and running until the mid-1980s) and involves engineering expertise, Governments can't magic power plants out of thin air after a crisis emerges. The sensible reaction to the 1970s crisis paved the way for a stable energy sector which enabled the economic growth of the 1990s and 2000s. But did this cheap reliable electricity that we all took for granted back then create a false sense of security? You flick the switch and the lights automatically come on. The switch from one form of power generation with chimneys and stacks and emissions could seamlessly be made to another with turning blades and no emissions. You flick the switch and the lights automatically come on or will they ? 

  

Save the peace & tranquility of Gougane Barra for future generations

 One of Ireland's most unique scenic areas, Gougane Barra in Cork, is at risk from environmental degradation if plans for a massive wind farm go ahead.  

Even though Ireland's experiment with wind energy has failed, as we are forced to build more gas power stations to keep the lights on and electricity prices have skyrocketed, the wind hysteria is not yet over. Future generations will wonder how could one of the most sacred places in Ireland be industrialised by wind developers. 

Please sign the Petition to stop it and be on the right side of history :

https://www.change.org/p/an-bord-plean%C3%A1la-save-the-peace-tranquility-of-gougane-barra-for-future-generations-petition-only

Ireland Ranks near bottom of Renewable Targets Table

 Wind Energy Oriented Renewable Plans Fared Badly

Ireland just about reached it's 2020 renewable target of 16% equalling Poland, a country not exactly renowned for its love of the "green religion". Ireland ranked 20th out of the 27th member states. Only Belgium, Luxembourg, Malta, Holland and Hungary ranked lower.

So the question must be asked - where did Ireland go wrong after spending billions on renewable energy and building 5,000MW of wind farms ? 

Surely if wind speeds are so high in Ireland as we are often told, then Ireland should be in the top 10 of Europe ? 

Sweden, Croatia, Finland, Bulgaria, Latvia and Austria topped the list of renewable energy performers in the EU.

Here are the main sources of renewable energy for each country :

Sweden - hydro, biomass. Exports a lot of electricity to Finland.

Croatia - hydro with some wind and solar. Imports a lot of electricity.

Bulgaria - hydro and solar. 

Finland - biomass and hydro. Imports a lot of electricity from Sweden and Russia.

Latvia - biomass and hydro.

Austria - biomass and hydro.

And for countries outside the EU - - 

Iceland - geothermal.

Norway - hydro. Norway has 65 times as much hydro as wind.

This clearly shows that the most successful renewables are Hydro and bioenergy/biomass. There are also significant benefits to interconnection especially if the neighbouring country has a lot of hydro. For instance, Denmark has a similar amount of wind energy to Ireland, but relies heavily on imports from hydro based electricity in Norway and Sweden which means wind has to do a lot less heavy lifting than in Ireland (because imported electricity is emission free). Denmark ranks in the top 10 of the EU renewable energy targets table for this reason.

It looks like Ireland backed the wrong horse with wind energy.  However, based on past performance, it is unlikely that Ireland will put the brakes on and assess the situation.

The Forgotten Science on Peat Bog Formation

 I recently received a gift of a new book by Francis Pryor called "Scenes from Prehistoric life". I have not read it completely and most of the book seems to relate to Britain. I came across an interesting bit about how bogs were formed which didn't seem right to me. Pryor writes that prehistoric sites occur relatively high in bogs because when the bogs formed in Britain and Ireland around 12,000 years ago, Britain still had not been re-inhabited following the end of the last Ice Age. It was only when farming began in the 5th millenium BC that the evidence for settlement increases rapidly.

"These later remains tend to be found in the higher layers of peat which were the first to be removed during the process of extraction."

I thought this section of the book a bit strange because in Ireland there have been many artifacts found very deep in bogs e.g. - -

A todh or breastplate found 12 feet down in a bog in Limerick :

https://www.libraryireland.com/Druids/Druidical-Adornment.php

 - A celt stone implement found at  a depth of 15 feet in a bog in Derry

 -  Pottery found at a great depth in a sligo bog  

 - An ancient wooden candlestick found at a depth of 16 feet deep in a Kerry bog

 A leather shoe found 20 feet deep in a bog in Tipperary  

Then there is this remarkable bog find of an ancient house in the early part of the 18th century -  from William Wilde's 1857 book on ancient artifacts (yes, that is Oscar's father). It was reckoned that the house was found 26 feet deep in the bog :

Which is corroborated here :

This agrees with the statement of Killpatrick, who asserts that he has taken twelve turf deep above the top of the house, and as every turf is about one foot long, it would give sixteen feet for the thickness on the top of the roof of the house.

https://www.cambridge.org/core/journals/archaeologia/article/abs/xv-description-of-an-ancient-structure-dug-out-of-drumkelin-bog-in-the-parish-of-inver-county-of-donegal-in-the-year-1833-communicated-by-captain-william-mudge-rn/7C10516DCBFAD7A5A3E100ADE0553240

More recently, H.H. Lamb in his book "Climate, History and the Modern World (1995), gives a completely different account to Pryor. In England and Wales, evidence of man's activities was found in the earliest layers of peat formation :

So one has to wonder, did now deceased archaeologists find most of the deeper bog artifacts decades and centuries ago and have modern archaeologists simply forgotten about them ? 

I raise this point here because it shows that science today sometimes forges it's own path without having regard to the knowledge gained before. While Pryor may be writing from experience, it should be pointed out that his conclusions differ from those experts gone before him and if they are correct then it proves that man has been altering the environment around him for many thousands of years. And most remarkably, even before the formation of peat bogs. 

Off Grid Electricity keeps Lights On

Significant amounts of Diesel generation keeping the lights on at times 

 "With regard to demand side units, even at the start of September we saw a significantly tight period. At that point, wind was giving us very low electricity. Demand side units were asked to become active and they did. They can respond and they can make a material difference there " - Energy Regulator, October 2021

Demand side units are off Grid forms of generation that allow large users of electricity to switch off from the grid and generate their own.

According to eirgrid, most of this form of generation is diesel generators :

Industrial generation refers to generation, usually powered by diesel engines, located on industrial or commercial premises, which acts as on-site supply during peak demand and emergency periods [Eirgrid Report]

The energy regulator, in an Oireachtas Committee debate in October stated that these generators made a material difference in September when wind speeds were low.

What this means is that at times a significant proportion of electricity produced in this country is not counted in the official figures. So when you read that gas has produced 57 % and wind 35 %, these figures refer only to the on grid proportion only. We do not have figures for off Grid which is mainly diesel. 

A Solution to the Collatz Conjecture

I recently came across The Collatz Conjecture and was intrigued by how simple the puzzle was. It works like this - take an even number, divide it by two, if you end up with an odd number, multiply it by three and add one. It appears that for every number you begin with, you always ends up back at 1 through the sequence 4 - 2 - 1. Many mathematicians regard the conjecture as impossible to prove. However,  I came up with a very simple proof in half a day. 

This is a useful calculator to check various numbers and sequences :

https://www.dcode.fr/collatz-conjecture

The first step must be to begin with the simplest odd and even numbers - 1 and 2. 1 always goes to 4 and 2 always goes to 1. Every single number to infinity is comprised of these two numbers so it shouldn't really be surprising that we end up back at 4 - 2 - 1 for every number. The puzzle is set up from the start to return to this loop. 

Next, you have to understand that it is irrelevant how high the number is we start with or how high a number we reach. All that matters is the very last digit in each number. 20,036 is the same as 2,036 or 136. This is because we count to the root of 10. If you break down numbers into blocks of ten,  then 15 is simply the number 5 repeated again except it is on the second row of numbers (think of bricks in a wall). In music, there are only 12 notes, however, you can play an A note an octave higher, the musical equivalent of the second row of numbers.  Therefore, the exact same pattern or sequence will repeat itself over and over again regardless of the magnitude of the numbers. 

20036

10018

5009

15028

7514

3757

2036

1018

509

1528

764

1036

518

259

778

389

136

68

34

17

52

You will of course notice that there are variations in the sequence in those last digits. This is because different patterns repeat themselves in every second row of numbers. This flow chart gives a handy summary of the sequences :

So these variations repeat themselves and therefore the conjecture is based on very simple predictable sequences. A number ending in 6 can go to either a number ending in 8 or 3. 8 brings you to either a 9 or a 4. 9 always brings you back to an 8. Take 19 or 25,379 - you will always end up with a number ending in 8 after multiplying by 3 and adding 1. 

4 brings you to either a 7 or a 2 depending on whether the number is on every first or second row of numbers. The numbers 14, 34, 54, 74, 94, 114 etc will give you numbers ending in 7 while 24, 44, 64, 84 etc will give you numbers ending in 2. 

The next step is to check if there is a magic sequence that reduces a very high number to a very low number. This is an important step because it explains how we can go from a very high number to a low number approaching 4, 8 or 16 i.e. the final sequence in a few steps. 

 The answer is that there are two magic sequences. By continually multiplying by three and adding one, no matter what number you begin with, you will always arrive at a magic sequence eventually. Or another way of putting it, no matter how high you go, you will always return to a very low number. The first magic sequence is 8,4,2,1. This sequence arises from a simple fact that every school kid with basic knowledge of mathematics knows -  that if you divide any square of 2 in half you will always arrive at a sequence of numbers divisible by 2.  Magic sequence number 1 results in a cascade of numbers all the way down to 1. There may be other numbers in front of that 1 but this proves the tendency of the conjecture to approach 1.

The second magic sequence is 6,3,0,0,0,5 with some variation in the number of zeros. This arises out of the fact that sometimes numbers ending in 6 give a number ending in 3 which then always gives a number ending in zero. Zero numbers always half very neatly and give another cascade effect - e.g. 160, 80, 40, 20, 10 which then gives a 5. Normally, magic sequence #2 follows #1 resulting in a super cascade effect as you can see in this example. Also, if magic sequence #1 is interrupted by a 7 say, magic seq #2 will usually follow.  

2308
1154
577
1732
866
433
1300
650
325
976
488
244
122
61
184
92
46
23
70
35
106
53
160
80
40
20
10
5
16
8
4
2
1

We can see that 976 results in 61 after four steps which is 16 times less or  24   times. So magic seq#1 gives  976/24   = 61. Three steps later, we are at 46 and now locked into magic seq#2 which gives us 35 and then 160. 160 cascades to 5 after five steps, a drop of 32 times or 25  times.  Once we get to single digit 5, we will always end up back at 1. 

Here is another example. In this one, we don't reach a magic sequence for a while but once we do we are very nearly there. 

87
262
131
394
197
592
296
148
74
37
112
56
28
14
7
22
11
34
17
52
26
13
40
20
10
5
16
8
4
2
1

Some numbers like 27 just take longer to reach one of the magic sequences, 65 steps in fact. Then once the second magic sequence is reached after that, we are very close to the end. 

So there is no mystery at all here. We have endless time and limitless amounts of steps which means we will inevitably reach those magic sequences which are the simple result of counting to the base of 10 and the inherent characteristic of the number 2 and its squares. Remember that built into the rules is the number 2 - 1, 2, 4..

The only mystery is how this conjecture has puzzled mathematicians for so long. 

Eirgrid to Underground New Grid Infrastructure

 Over the past decade, as many readers will know, there has been a huge furor in many communities north and south of the border about the North South Interconnector. With the main bone of contention being the decision by Eirgrid not to underground it. However, it looks like Eirgrid have finally learned a lesson from that and are now listening to communities. But surely this new approach by Eirgrid raises questions about their existing plans for the North South Interconnector ?

On the grid side, we have made three decisions in the past 12 months that we arguably might not have made five years ago. We declared that two major pieces of grid infrastructure are going underground. The first is in the Dublin-Kildare region where we have made the call and said a critical piece of west Dublin infrastructure is going to be underground.

We have said the line to Mayo will be underground and the converter station for the Celtic Interconnector, one of Ireland's most critical projects which will link us to France, will be located not beside the substation in Knockraha, but in an industrial site in Ballyadam. This is because that is what communities asked us to do - Mark Foley, CEO Eirgrid

Link :

https://www.oireachtas.ie/en/debates/debate/joint_committee_on_environment_and_climate_action/2021-10-05/2/

The Green Europe and Unsustainable Finances Paradox

 

The graph below shows the total balance sheet assets of three of the world's major banks - the Fed in America, European Central Bank and Bank of Japan. It is noteworthy for many reasons. Firstly, the ECB has overtaken the other two with total assets of $9.6 trillion. Most of this is due to quantitative easing (QE) or money printing. 

The ECB has been engaging in large scale QE since 2015, long before the covid pandemic. Which is odd since most of Europe's economies were strong then. Certainly, here in Ireland, house prices were rising again, as were rents by 2015 and 2016. At the end of 2016, the government brought in rent controls to cap rent increases. Also in early 2016, the European Commission expected Ireland to be the fastest growing economy in Europe. Yet, Ireland was been flooded with this cheap ECB money which the government was only too happy to take and spend in an economy beginning to heat up (on a side note - it didnt fix the health service did it ?). 

As the pandemic hit in March 2020, the ECB went even further than US and Japan and printed enormous amounts of euros to the extent that they practically doubled their balance sheet. Although there are other factors impacting inflation right now, I believe this to be one of the main reasons, if not the most significant. Over half of this new money has gone to government bonds, a record amount of central bank financing of government debt. Normally, the government would have to go to the market to trade their bonds. But we are far away from normal in this age of negative interest rates. Now the central bank prints the new money to buy government bonds that presumably most of the market would not touch.

What is remarkable about all this is that, in a Europe completely captured by the green movement,  government finances have been allowed to reach such epic unsustainable proportions. Surely, government spending should be reduced so as to reduce consumption. Enabling countries to spend beyond their means and deferring the cost of excessive consumption should be the last thing that green politicians should want. It's true, that some of this spending has gone on renewable infrastructure such as wind turbines and pylons (about € 1 trillion) . But these technologies require large amounts of rare earths and metals to produce and so contribute to more consumption and more mining of the planet. Instead, the preferred method to reduce consumption is through taxation. The problem with taxing fuel and electricity is that it results in yet more government spending as the poor and working class become even poorer and are unable to pay for necessities like fuel and electricity. The government then gets locked into a spending cycle where pressure comes on it to increase social welfare supports and just recently the Irish government has planned to give every household €100 off their electricity bill. The cycle of taxation - borrow / spend - inflation - tax - borrow - inflation continues.

If we were really serious about sustainability then we would get our finances in order first. By encouraging people to save instead of spend, we slow that economic growth that eco warriors claim is destroying our planet. We put the future on a firm sustainable footing. But instead we have created the exact opposite environment of low / negative interest rates where people are unable to save and governments spend beyond their wildest dreams. 

It is incredible to me that green politicians are not aware of this simple paradox. Or perhaps that old saying "money talks" is more relevant than ever and still overrides all of the green buzzwords that politicians love to use. 

More Gas Power Stations to be Built

The government have issued a policy statement on security of electricity supply which states :

• the development of new conventional generation (including gas-fired and gasoil/distillate-fired generation) is a national priority and should be permitted and supported in order to ensure security of electricity supply and support the growth of renewable electricity generation

This amounts to an admission that the renewable programme has failed. Imagine if a smoker said I will need to smoke more just to support my attempt at quitting smoking. They would rightly be ridiculed.

 

• it is appropriate that existing conventional electricity generation capacity should be retained until the new conventional electricity generation capacity is developed in order to ensure security of electricity supply

Many years ago on this blog I warned that wind energy would never be capable of replacing a power station. Here we have an admission that Moneypoint coal power station and Tarbert oil power station cannot be replaced by renewables. So what is the point? Henry Ford's model T replaced the horse and cart. The telephone replaced the telegram.

The same government banned gas and oil exploration and of course a coal mine would never be allowed to open again in Ireland. So what will all these fossil fuel power stations run on in the new energy scarce future ? Hot air? Wishful thinking? Empty platitudes? Virtue signalling? Of those, we have plenty. 

Can the VAT rate on Electricity be Reduced?

Sinn Féin suggested recently that the VAT rate on electricity, currently at 13.5%, be temporarily removed to ease the burden on households over the winter. The government have claimed that they can't do that due to EU law. In this post, I will take a quick look at the VAT Directive and try to establish what is actually permitted. 

First of all, there is no doubt that the minimum vat rate allowed is 5%, so that rules out a complete removal of vat :

"The reduced rates shall be fixed as a percentage of the taxable amount, which may not be less than 5 %". 

Next, Article 118 states that certain services cannot go below 12% and this was referred to by the government as applicable to electricity. As electricity comes under Annex 1, it would seem that the government is correct (- -but wouldn't 12% be better than no reduction ? ) :

" Article 118

 Member States which, at 1 January 1991, were applying a reduced rate to the supply of goods or services other than those specified in Annex III may apply the reduced rate, or one of the two reduced rates, provided for in Article 98 to the supply of those goods or services, provided that the rate is not lower than 12 %". 

However, something that has been noticed before is that there is often a grey area with EU law. Article 102 deals specifically with the supply of energy, including electricity and allows for either of the two reduced rates to be applied. In the case of Ireland, the two reduced rates are 13.5% and 9% (for hotels) :

"Article 102

After consultation of the VAT Committee, each Member State may apply a reduced rate to the supply of natural gas, electricity or district heating"

It is remarkable that no reference is made here to the minimum rate of 12%, but as article 102 precedes 118, perhaps it is inferred that 102 can be relied upon alone in relation to electricity. In that case, surely, a reference to the exception under 102 should have been made in 118. 

I am no legal expert and perhaps someone can comment below on what they think. 

We can test the legal recipes in the EU VAT directive by the results. And here, it would seem to be the case that when we look at other European countries, the vat on electricity can be reduced to a minimum of 5%.

- - Portugal reduced the vat on electricity to 6% for low usage households in 2019. Initial figures show that the reduced rate applies to about 42% of customers with the rest paying vat at the higher rate of 23%.

- - Spain have introduced a temporary reduction to 10% for low usage customers until December 2021. After that, the vat will revert to the normal 21% rate. It is estimated that the vast majority of households and businesses will qualify for the reduced 10 % rate. 

- - Italy have a fixed vat rate of 10% on electricity. This proves that the minimum rate of 12% does not apply to electricity as per article 102 . Applying the Italian model to Ireland would mean we could reduce our vat rate to 9% on electricity. 

- - Greece have a super reduced vat rate of 6% on electricity since 2019. This also applies to medicine and vaccines as well as children's books. Their normal reduced rate is 13 % which applies to hotels. It is interesting to see that in Ireland we seem to have our priorities completely wrong with hotels regarded as more essential than electricity. 

- - The UK had along with Malta the lowest vat rate on electricity in the EU with a rate of 5%. One of the reasons for brexit is that they were not able to reduce it to zero. 

- - Luxembourg have a vat rate of 8% on electricity. 

It seems clear that the vat rate on electricity can be lowered to at least 9%. But the government have chosen the spending option as usual which means additional handouts to struggling families. Which in turn will lead to a cycle of inflation as bills rise even more. 

EU Ban Scottish Potato Seeds

 Ireland has been importing potato seeds from Scotland for over 150 years but amazingly the EU has banned them following Brexit because they do not comply with "phytosanitary rules". I thought it truly remarkable that the most virus resistant seed available to Ireland since the Great Famine does not comply with EU rules. And we pay the EU for the privilege. 

1866

1879

1949

Peak Winter Demand Arrives

Things get a little bit shaky !

 Last night at 5.30pm, the electricity grid hit peak demand for All Ireland at 6,638MW - not far off Record peak demand of 6,878MW reached on December 21st last year.

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But total system generation was only 6,106MW leaving a shortfall of 532MW.  

Wind energy was low most of the day, only 380MW or about 7% was available for the whole island at 5.30pm.

The two UK interconnectors saved the day with combined imports of 450MW. There was still a shortfall of about 80MW, made up presumably from demand side units. These would comprise mostly of diesel generators and combined heat and power units. These units are "non-centrally monitored" according to Eirgrid and are not included in these graphs.  

Of course, that damned Brexit lot across the sea with their dastardly nuclear power charged us handsomely for the imported power, at € 2,000 a MW. 

To give some credit to the Irish grid operators, they were correct to build the East West interconnector as it is making up for the once efficient gas plant that have been prematurely wrecked from backing up the wind. One just hopes that the UK will have sufficient power to give us on those cold winter nights over the next few months. 

Whitegate and Dublin Bay Power Stations Trip

 850MW of generation lost last night

Both Whitegate and Dublin Bay gas power stations tripped last night a few hours after I had published about the return of Whitegate power station. Dublin Bay appears to be back this morning but Whitegate is still offline. This shows the precarious nature we are in. It now means we are dependent on a not too dependent interconnector and wind system. 

There is no reason given for the outages. It's possible that the loss of one power station can trip another but whether this is what occurred last night I do not know. 

Whitegate Gas Power Station back in Action

 Whitegate power station has in the past hour returned to operation after nearly 12 months out of action due to a turbine fault. It is expected to return to full commercial operation tomorrow. A small loose bit of metal caused significant damage last December to what is a very sensitive piece of equipment. It was due back at the beginning of November. The return of the 444MW power station comes just at a good time as the weather has turned cold and demand is rising. Also imports from the UK  and wind energy appear to be very low in the past few days. 

Back in July, the Energy Regulator warned that power stations have become less reliable due to extreme operational requirements that they were not designed for during periods of intermittent wind. 

Is the Covid Vaccine Working ? (Part 2)

 The covid vaccines do not seem to be having the same impact as previous vaccine rollouts such as the MMR vaccine :

Source : https://www.bmj.com/content/330/7500/1119

Introduced in October 1988, there was a 90% vaccination rate for children in the UK, similar to the rate of the covid vaccine here in Ireland. The impact is apparent in the sharp fall in rates of infection in the following years. 

Saving the Amazon not on the COP26 Menu

 I had a quick look at the objectives of COP26. The main ones are - lower emissions, stop coal, more EVs, more renewables, protect only those ecosystems affected by climate change and printing more money.

The biggest environmental problem in the world today is the destruction of the Amazon rainforest. The leading cause is cattle ranching. Banning the importation of Brazilian beef until the destruction stops would help save the rainforests. 

But that is not on the menu at COP26. The modern environmental movement is not fit for purpose.

Precarious Winter Outlook

According to the Eirgrid Winter Outlook, the Irish electricity system will be operating at twice the level of acceptable risk this winter. The system is expected to enter the Alert State at times of low wind, low interconnector imports and low temperatures. No mention is made of Huntstown or Whitegate power stations. Are they assumed to return as expected? We are not told [update: it appears that Huntstown will be back later this week]. 

There are a number of engineering realities that are laid bare in the report that are a sobering read and at odds with the endless spin that has been published in the past in the media about green energy. 

•  Only 9% of total wind energy capacity is deemed as reliable or can be relied upon. 

•  Forced outage rates (the rate at which power stations are breaking down) have increased by 5 times over the past 5 years. This would appear to indicate that these power stations cannot cope with higher levels of intermittent wind energy.

•  Some CCGT (gas) plant is scheduled to be unavailable for 5-6 weeks of the winter period because of scheduled maintenance. This will be in November and early March. There is no guarantee that wind energy will be available during these weeks and, hence, the highest risk of blackouts will occur during these periods. This proves that wind energy cannot replace, nor is it equivalent to, a power station. 

There is also another factor which does not seem to be included in this report. Wind farms, like power stations, also need maintenance - in particular, the older fleet. Whilst it is unlikely that a significant amount of them would break down at the same time, sourcing replacement parts may take more time than normal in the present supply chain crisis. 

This is the first time that Eirgrid have published a winter outlook that warns of a high risk of blackouts. Last year, they were concerned about a trend of "increasing demand, dispatchable generation exiting the market and increasing generator forced outage rates". 

They were correct, that trend has continued into this year. Did anyone listen or take note ? Of course not. But then Eirgrid's own chief, Mark Foley, dismissed concerns about blackouts, saying  people can sleep soundly in their beds this winter.  

We must trust the plan.