Car Talk

Car Talk, the February issue of TerraJoule.us, discusses the plausible deployment rates of electric vehicles (EV) and autonomous vehicles (AV) in the context of a changing transportation market where the current dream is to detach automobiles from personal ownership. To counter some of the current excitement over an imminent revolution in transportation,  we show that existing solutions, like public rail transport, have been successful already in competing away marginal demand for automobiles, and oil. Overall, when we look at comparable infrastructure buildout rates for wind and solar technology, and the exceedingly slow rate so far of EV adoption, TerraJoule.us concludes that transition in mobility will run into familiar resistance points before the scaling process truly begins.

In the second essay of this month’s issue, “Oil’s New Problem”, we note the global oil market now is entirely dependent on demand changes in Non-OECD economies. And we wonder, if after 15 straight years of market share losses, whether energy transition has finally caught up to oil.  Conversely, with a flood of exceptionally cheap energy from all sources fanning out into the world—oil, coal, LNG, wind, and solar—it seems probable that this massive cost reduction will convert to stimulus by next year.

Relatedly, in the continuously updating TerraJoule.us Global Grid Decarb Monitor, projections for marginal growth from wind and solar are raised for 2017. A better economic outlook drives one part of this revision, but the normalizing effects of recent tax policy changes from the US will smooth both markets as we cross through next year, into the end of the decade. We also raise substantially the total growth rate of new power generation, from all sources, in the 2017 forecast.

Finally, The TerraJoule.us Transition Index, composed of 70% ETFs and 30% individual equities, stands at 91.59 having started the new year at a notional value of 100. The Index plays a favored super-theme of TerraJoule.us: that the global economy is transitioning away from liquid fossil fuels, to the powergrid. And, that the costs of fossil fuel extraction and combustion increasingly place the energy-capture technologies of wind and solar power in a favorable position.

–Gregor Macdonald, Editor of TerraJoule.us – A Journal of Energy Transition.