Posted by: A_P September 18, 2009
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Ken Fisher is a rich, successful investor and a money manager... so he must be doing something right.
But, the reasons he gives for a solid growth in investment in fossil fuel for the next 20 years aren't all correct.
1. He says when we drive hybrid or battery-powered cars, we actually are still burning oil (or natural gas) because, he says, the electricity to charge the battery is generated by burning oil (or gas). Not so; not everywhere. At least not where I live. Where I live, almost 93 percent of electricity comes from hydropower, only 6 percent comes from natural gas and 0.2 percent comes from diesel oil.
2. He says those who oppose fossil fuel due apparently to its environmental externalities (like GHG emissions and air pollution) or any number of other reasons also oppose hydropower and nuclear power. That's quite a stretch. For me, that's news. I have never heard of anyone opposing hydropower. Yes, where I live there is some opposition to independent power producing (IPP) model of hydropower generation but that has nothing to do with the technical aspect of generating energy. The opposition is strictly about ownership of hydropower projects. Those who oppose IPP are not opposed to hydropower, they only want to keep those projects in public domain (government owned), not in private hands (corporations).
3. He says non-fossil fuel energy, non-hydropower, and non-nuclear energy sector accounts for only 1.5 percent of energy sector globally. I won't dismiss that claim (because I don't have the facts and figures to confirm or deny that), but I think by lumping hydro and nuclear with fossil fuel in making an argument for a future growth of fossil fuel market, especially outside of North America, he is being disingenuous. Because, hydro and nuclear are completely different games. Their sets of externalities are nowhere near to those of fossil fuels. I don't know about nuclear, but I know that hydro has a great future, but I'm not so sure about fossil fuel. Yes, he may be correct, though, that for the foreseeable future growth in fossil fuel use will still continue, despite that we may have already hit "peak oil", but that's not because of bad faith in non-renewables; that's because fossil fuel derived energy is relatively cheaper and transportable (because many of them come as liquid or liquefied gas) than non-conventionals. But that's a no-brainer, because non-conventional energy sector will take the time it needs to mature and become stable and reliable. But still, fossil fuel energy s definitely not cheaper than hydropower.
But, I can't expect anything different from Fisher. He's an investment analyst and money manager; he's not an energy analyst. He's making a pitch to sell energy stocks to add to your investment portfolio.
The future belongs to non-fossil fuel energy.
Still my $0.02.
Last edited: 18-Sep-09 01:08 PM
Last edited: 18-Sep-09 01:09 PM