Don't panic, don't panic!

The dark side of the political spectrum aka the Lib Dems have told the news media that Cameron is panicking over energy prices. Which might be true, he is a politician after all and power is the drug of choice for him. It does however strike me that he's panicking for the right reasons in that energy prices look like being his downfall and he really needed to realise that green taxation in particular was a millstone around his neck that he didn't really need.
BBC.

The Liberal Democrats have accused David Cameron of making a "panicky U-turn" after he announced a review of green energy taxes.
The prime minister said household bills were at "unacceptable levels" and promised to "roll back" regulations introduced by Labour.
But a senior Lib Dem source said Mr Cameron had got "cold feet" on environmental policy promises.
Labour also criticised the PM, but he promised to help cut people's bills.
Conservative MP Zac Goldsmith said Mr Cameron and Labour leader Ed Miliband were "Muppets" in their attitude to energy policy.
Cameron said, said the government's focus was on dealing with the aspects of energy bills it could control. Green taxes, he said, accounted for £112 of the average annual dual fuel bill and should be reduced.

Oh a dastardly attack by Cameron on something invented for something which doesn't really exist other than in the minds of enviroloonies and greedy on the make politicians. I mean how dare he remove a massive barrier in the path of people who don't wish to freeze to death in their homes because energy companies have to increase their prices within their own and the governments greed?
For a lot of our elderly it's become a choice between heating your home or eating, indeed almost 9,000 winter related deaths in the UK happen because of the fact that our old simply cannot stay warm enough due to government interference in their bills. Sure it's not the only cause, but it is a major factor, something the government and the enviroloonies refuse to even admit is directly due to their meddling.
Green taxes kill our elderly and sick, they've pushed ordinary families into what is described as fuel poverty. Cameron may be panicking, but at least he's panicking in the right direction...

Own goals

Inflation is on the up though apparently (amazingly enough) much of it is the fault of our idiot politicians and their ever grasping nature.
Mail.

Sir Mervyn King yesterday accused the Government of scoring an embarrassing ‘own goal’ by pushing up inflation through green taxes and tuition fees.
The Governor of the Bank of England warned that the unprecedented squeeze on living standards will last for a further three years as prices rise and wages stagnate.
But, in a coded attack on ministers, he said much of the pain was ‘self-inflicted’ because it stemmed from big increases in energy bills and tuition fees.
‘Whether it’s on financing education, green policies or other policies, what they have done is push up prices and that clearly makes our job in the short-run more difficult,’ Sir Mervyn said.

Yes in their ever increasing attempts to make kids pay for adult education in universities along with the ludicrous claims that green energy is somehow going to save the planet from CO2 and we should be honoured to empty our pockets into their coffers it does appear that Mervyn King actually knows what and why it's happening.
Not that I expect ministers to take any notice other than to trot out a few cliches such as hard times and the needs of the planet etc.
What Mervyn King didn't say (but I am) is that we're being ripped off by greedy uncontrolled government who have it in their power to rid us of these hidden taxes and can bring inflation down to boot.
The green energy scam has been going on far too long and is enriching those in government who support it in the energy ministry. huge ugly bird mincers dot our landscape whilst the ones at sea corrode and fail due to the fact that they cannot be efficiently maintained. This plus the subsidies used to make them economic come out of the green surcharge as in any normal world they simply would be a failure due to market forces.
In no sane world would a nation dependant on keeping the power going use wind power as it simply does not work generally when it's needed.
Coldest days of the year = generally no wind.
No, we're being robbed and they know it and we know it, problem is they don't care and we don't seem to vote them out...

Too good to be true?

One of the many problems this country faces is its energy dependence on foreign suppliers, from Russian gas to Islamic oil, neither having our best interests at heart. Yet essentially we're a technological society that depends on the burning of hydrocarbons to produce the power we need, for transport and power generation. Despite the claims of the greens, a hell of a lot of hydrocarbons go into the making of their bird-mincers and sunshine panels, environmentally friendly they aren't save at the point of use and they aren't even particularly efficient there either. Still when someone comes up with a formula to produce petrol from air you have to wonder just what medication they're on (and could we have some)
Telegraph.

A small company in the north of England has developed the “air capture” technology to create synthetic petrol using only air and electricity.
Experts tonight hailed the astonishing breakthrough as a potential “game-changer” in the battle against climate change and a saviour for the world’s energy crisis.
The technology, presented to a London engineering conference this week, removes carbon dioxide from the atmosphere.
The “petrol from air” technology involves taking sodium hydroxide and mixing it with carbon dioxide before "electrolysing" the sodium carbonate that it produces to form pure carbon dioxide.
Hydrogen is then produced by electrolysing water vapour captured with a dehumidifier.
The company, Air Fuel Syndication, then uses the carbon dioxide and hydrogen to produce methanol which in turn is passed through a gasoline fuel reactor, creating petrol.
Company officials say they had produced five litres of petrol in less than three months from a small refinery in Stockton-on-Tees, Teesside.

As an engineer having worked occasionally in the chemicals industry at first I thought this must be complete bollocks (and my engineering hindbrain is still telling me that too) I'm also wondering about the laws of conservation of energy too, it simply doesn't happen that you get more out than you put in, you can release energy, you can't create it so to speak. Yet if the process is economically viable in producing a petrol substitute at less (or equivalent too) the current market cost then these guys are onto a winner. Though again the usual caveats involving cold fusion apply here, if it looks too good to be true then it probably is.
Nor can we expect that the big fuel companies will be interested, not unless of course they can see at least as much profit for themselves in it, still a chemical plant in a nice safe democracy has got to be a better bet than an unstable theocracy...
If we can break the ties to foreign energy supply via shale and now this process we may be able to turn back some of the overt influences those suppliers have forced upon us too (yes we're looking at you Saudi Arabia) so I'm going to watch this one very carefully and hope some middle east cartel doesn't buy it and bury it...

The real rip off is by the government

Another day, another article about fuel prices and the fact that the pump price doesn't reflect the barrel price. Mostly though missing the point on who makes the biggest take on the price...
Telegraph.

The AA motoring group found drivers are consistently paying around 5p more for diesel at the pumps, even though it is often the same price as petrol on the wholesale markets.
The price of both fuels has almost reached the record high seen in April, with petrol at 140.21p per litre and diesel is now 144.6p per litre.
However, at three times this year, including this month, diesel has actually been cheaper than petrol on the international markets.
It now costs just over £70 to fill up a typical 50-litre family car with petrol and £72.30 to fill up a diesel one.

 Completely missing the point that 60% + is taken by the thieving government in duty and VAT. so what we could be paying is £28 and £28:92 at least according to the article, perhaps even less. The rate could be up to 64% or more rake off.
Just think of the boost to the economy if the government would give up on grabbing so much cash from a natural resource. Fuel affects the price of just about everything we buy or do, from groceries to travel, the money it would put back in our pockets along with the increasing competitiveness of our industries and goods.
Probably some stupid EU rule about it though, along with a Westminster politicians almost unnatural ability to see things to spend our cash upon, rather than save us some money by leaving it in our pockets.
Yes, that's right, it will never happen so long as we keep voting for the avaricious incompetents...

Well there's a reason for that

I did have to smile at the 'evidence' that diesel cars were actually more expensive to run that petrol cars. because the actual reason why is in the article.
Mail.

Great diesel myth: They DON'T save you money and petrol models 'are more economical for most makes of car'

• Can take up to 14 years before diesel cars save the average driver money
• Fuel can be almost 6p a litre more expensive than unleaded petrol
• Findings come as diesels make up over half of new car market for first time.

Diesel cars’ reputation for saving drivers money has been shattered by research showing they are often more expensive than petrol models.
It concludes that ‘diesels are no longer the default option for frugal motoring’.
While diesel engines may deliver more miles per gallon, it can take up to 14 years before they save the average driver any money.
This is because of the higher cost of diesel cars and of the fuel, which can be almost 6p a litre more expensive than unleaded petrol.

Yes, the reason that diesel cars take so long to pay back their costs is simply that the greedy government actually taxes diesel at a much higher rate than it does petrol. The article also seems to have missed the evidence that a diesel engine will last up to 3 times as long as a petrol engine if it's kept serviced, simply because the build of the engine requires a far higher degree of  internal strength owing to the pressures and torque of the engines. basically diesels are simply better built and this is reflected in the price of a new vehicle, though where diesels actually come into their own is in the second hand market where you can pick up the equivalent diesel model at the same price as a petrol model and expect to get a far higher mpg plus a car that will simply keep going far longer than its petrol driven cousin.
If the greedy sods in government were ever to reduce the fuel duty on diesel to the same as petrol then the payback on diesels would increase significantly. As it is, the only reasons it isn't is directly due to government interference.

Only 2p?

A fuel price war has erupted crow the MSM with Asda dropping its price 2p a litre before the Mayday holiday. Others have of course followed suit...
Express.

ASDA yesterday prompted a price war on supermarket petrol forecourts by slashing up to 2p a litre from both unleaded and diesel.
The cut, which comes just in time for the big Bank Holiday weekend getaway, was immediately matched by Tesco and Sainsbury’s.
Other major retailers are expected to follow suit.
The news provides a boost to ­Britain’s hard-pressed motorists who have seen fuel prices soar.
Just last month the AA said increases this year had added £21.72 to a two-car family’s monthly petrol bill. A typical 50-litre family car was costing £71.24 to fill, a rise of £5.12 since January.
Yesterday Asda claimed its price-cutting move was possible because of a drop in global oil prices coupled with the supermarket’s “ongoing commitment to help lower the cost of living”.

Ok, 2p is welcome, however in the grand scheme of things where fuel was costing in the £1.40+ a litre range it's actually pretty small beer. Though fair do's to Asda, they tend to have cheaper fuel than most places I pass anyway. What really rankles though is that the government could half its take on the price of fuel and drop the price in total by a third! That would get the economy moving, reduce the price of food and goods and put cash back into peoples pockets, but I'm not going to hold my breath on that one. Last I checked, the government got £25 billion from fuel, the overseas development budget is going to come in at £12 billion, so there's your savings straight away.
But yes, who am I kidding, the government takes, it does not give, it's even committed to ever more ruinous borrowing to keep things going rather than reduce its costs.
Still, you never know, one day perhaps we'll get a cost cutting government, but I doubt it will be from the 3 main parties, they're far too committed to spending our cash on things no government should be involved in. Though judging by the local election results, that's a long way off yet...

Temporary solutions

Seems that both Cameron and Obama have realised that high fuel prices might just be the straw that breaks the camels back, the camel being of course the opportunity to be voted in by the various mugs electorates they represent. So, what are they proposing?
Express.

HARD-pressed motorists were given a glimmer of hope yesterday after it emerged that David Cameron and President Barack Obama had discussed taking action to ease soaring fuel prices.
The two leaders talked about the possibility of releasing some of their countries’ reserve oil stock to increase availability and lower forecourt prices.
Speaking in New York, Mr Cameron said: “We are all facing the problem of higher oil prices and that translates into the cost of filling up the family car, which is very high here in the US, but frankly even higher in the UK.
“I want to try to help British families, just as Barack Obama wants to help American families.
“We didn’t reach a decision but we discussed the issue and I think it is important we do what we can to try to help families trying to make their family budgets add up.”

So instead of reducing the real cause of high fuel prices (taxation) they are going to attempt to glut the market with their reserves. That might work for the USA who only appear to have a taxation level of 20% on their fuel, but in the UK we pay something near 66% so for all a reduction might come it will not be as effective as far as I can see, though any reduction is of course to be welcomed.
The problem is though that these measures are only temporary, sooner or later the price of oil will rise again and we'll still have ludicrously high levels of taxation on the stuff.
The other thing that did occur to my paranoid way of thinking is that by opening up the vast U.S reserves, it rather looks like the USA (and the UK) are setting the stage for an attack on Iran, one of the first things the Iranians would try is to close the Straits of Hormuz to shipping thus cutting off the West's oil supplies, opening up the USA reserves would appear to be both a warning to the Iranians and a solution to the shooting war problem.
Either way, don't expect the price of fuel to come down by very much.

No fuel like an old fuel

One of the main things which is driving the recession in the UK (apart from toxic debt) is the cost of living coupled to the lack of an increase in income for most taxpayers. The cost of living itself is driven by rising prices in practically all areas, though there is one common denominator in all of this, fuel. The government could in theory kick start the economy by simply scrapping fuel duty and although there would be a reluctance for suppliers to drop the price totally down to market price, the difference to hauliers and even food prices would soon become apparent. People would have more money in their pockets, so would spend more, businesses would survive, some might thrive and all it would take is one small cut.

 After all they are adding somewhere in the region of 60% (at least to prices at the pumps.
As of 15th November 2010 the price of fuel, the fuel duty and the VAT level are shown in the table below:

Type of Fuel	Total Cost at Pump	Fuel Duty	VAT	% of Fuel Cost that is Tax
Unleaded	118.7p	58.19p	17.68p	64%
Diesel	122.3p	58.19p	18.21p	62%
LPG	67.5p	31.95p	10.05p	63%

H/T  http://whatgas.com/car-finance/fuel-duty.html

In 2007 fuel duty raised in the region of £25 billion, a reasonable chunk at 5% of government income...

H/T Wikipedia

But a 5% cut in the governments spending is surely an achievable target?
Of course there are those wiser in economics than I out there, there might be very good reasons why we cannot do this, though it strikes me as being quite worthwhile.
Of course it's probably illegal to do so because of the EU or some ridiculous green laws.
Still, it's a thought isn't it?