Piketty’s focus on inequality may also set a blueprint for the study of economics

first_imgThomas Piketty garnered international acclaim after his book Capital in the Twenty-First Century, about inequality, became a best seller. But it’s not without its critics. He’ll speak at the 13th Nelson Mandela Annual Lecture. Watch him on the live broadcast on 3 October on SABC 2 from 3pm to 4:30pm. There will also be live stream on the Nelson Mandela Foundation YouTube account and website. Thomas Piketty’s book Capital in the Twenty-First Century has been praised and criticised. (Image: Nelson Mandela Foundation, Facebook) • Thomas Piketty to deliver Nelson Mandela Annual Lecture  • What South Africa can learn from Piketty about addressing inequality?  • Piketty’s contribution to unpacking inequality: timely and relevant  • Top 50 Brands in South Africa named  • Almost half of African millionaires make South Africa their home Chris Edwards, University of East AngliaThe economic and political focus is increasingly on the inequality of income and wealth as they both rise in Europe and the US. At a conference on Inclusive Capitalism held near the end of May at London’s Guildhall, Christine Lagarde, the head of the International Monetary Fund (IMF), claimed that rising inequality posed a threat to growth and financial stability and that governments need to narrow the gaps through imposing more progressive taxes.When even the right-wing IMF criticises rising inequality, then perhaps it is no surprise that the publishing world should witness the huge success of a book on inequality written by Thomas Piketty, professor at the Paris School of Economics. What might be more surprising is that one crucial effect of his work might be nothing to with inequality or capital whatsoever, but could instead help to refocus how we study economics and arrive at less biased conclusions.Piketty’s basic argument is simple. He argues that over the past four decades the growth of incomes in the rich countries of Europe and the US has averaged 1% or 2% a year whereas the return on wealth or capital has been running at more than 4% a year. Under such conditions, wealth concentration grows as does political tension. We are, he says, returning to a sort of Downton Abbey world of the late 19th and early 20th century; a “patrimonial” capitalism in which inherited wealth dominates and a world in which the economy is characterised, not by talented individuals, but by family dynasties making up only 1% of the population. To join this exclusive club it is more sensible to marry into wealth than to work for it. It might be said that skiving and seducing are now better than striving (whatever Britain’s prime minister might say).Data minePiketty’s contribution has been to look at the pattern of wealth and income inequality in capitalist economies over at least the past 100 years. He, with the aid of a number of colleagues, has assembled a huge collection of statistics on income and wealth distribution in some 20 countries.What comes out of this is his claim that over the past century in Europe and more particularly in the US, the share of income going to the richest 1% has followed a U-shaped arc. In 1910 the richest 1% received around a fifth of total income in both Britain and the United States. By 1950 that share had been cut by at least half, but since 1980 the share of this 1% has surged so much that in the US that it’s back to where it was a century ago. The same pattern has been followed by the distribution of wealth.This U-shaped arc is the opposite of what was supposed to happen according to Simon Kuznets, a Belarusian-American economist who, in the 1950s, forecast an inverted U-curve for income distribution as an economy grows. In other words, according to Kuznets, as economies mature they are supposed to be more equal. According to Piketty, the opposite is happening with Europe and the US, heading back towards a Dickensian world of inequality.To avoid this, corrective steps are needed. Piketty favours a graduated wealth tax, imposed globally, an income tax of 80% on those with the highest salaries and an enforced transparency for all bank transactions.The controversyPiketty’s book has been broadly supported by economists in the centre of the political spectrum. Paul Krugman (the Nobel Prize-winning US economist based at Princeton University and the op-ed columnist for the New York Times) has praised it profusely. There have been attacks from both the political left and the right but particularly from the right. The Wall Street Journal has been apoplectic and the London-based Financial Times has been none too pleased.In these circles of the political right, arguments about the distribution of income and wealth invariably follow two routes. One is to deny that the rich are doing exceptionally well. The other is to claim that the rich deserve their soaring incomes and wealth and are really job creators not predators.The first of these counterattacks was launched by Chris Giles, the FT’s economics editor. He argued that Piketty was wrong to claim that inequality has grown over the past 40 years in Europe and the US. Statistics on income and wealth distribution are problematic. But, in my experience, income and wealth equality is generally over-stated rather than under-stated in rich countries – and this is true of the UK . It is to Piketty’s credit that he has shown all the statistics that he has used and he has said that: “I have no doubt that my historical data series can be improved and will be improved in the future”.In the meantime the general conclusion about the attack on Piketty by the FT seems to be summed up by the centre-right Economist magazine, namely that “the analysis does not seem to support many of the allegations made by the FT or the conclusion that the book’s argument is wrong”.Thus, the counterattack seems to fail. Inequality does seem to have increased over the past 40 years in Europe and the US. What about the second defence? Do the rich deserve their soaring incomes and wealth? Piketty argues “no” because the marginal productivity of managers is unmeasurable and economic performance has not improved since the 1960s while the pay of top managers has exploded.A critical assessment from the left has come from David Harvey, a Marxist professor at the City University of New York. Harvey criticises his book on a number of grounds. Here I have the space to focus on just one, namely Piketty’s failure to make the link between the increase in inequality, the financial crisis in 2008 and the recession that followed. Harvey argues that a rise in inequality increases the likelihood of slow growth as demand dries up and under-consumption takes hold.Interestingly, Harvey’s focus on the link between inequality and slow growth brings us back to the IMF in which a recent study by a number of economists finds that countries with high levels of inequality have suffered lower growth than nations that have distributed incomes more evenly.Despite his misgivings, Harvey does praise Piketty’s collection of statistics and it is here that we might find a final, and possibly enduring legacy from Piketty’s work.Krugman has said Piketty’s work will “change both the way we think about society and the way we do economics”. Perhaps. If the latter is true, it will be a breath of fresh air to those groups of students who have protested recently about the non-empirical, neo-liberal bias in the teaching of economics in British universities. It might be too much to hope that we can entirely detach macroeconomics from ideology, but the weight of authority brought by Piketty’s – and his colleagues’ – reliance on deep data analysis might at least offer us a blueprint for a better way of debating the dismal science.Chris Edwards, External Research Associate, , University of East AngliaThis article was originally published on The Conversation. Read the original article.last_img read more

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Moreno, PH Archers hope to put gold-less past behind them

first_imgPH Archery team. Photo by Marc ReyesKUALA LUMPUR—For Youth Olympic Games champion archer Luis Gabriel Moreno, studies will take the back seat for the time being.The 2014 YOG champ—in tandem with Chinese Li JiaMan—said he took a sabbatical from his marketing course at La Salle to prepare for the Southeast Asian Games.ADVERTISEMENT WATCH: Streetboys show off slick dance moves in Vhong Navarro’s wedding PH billiards team upbeat about gold medal chances in SEA Games PLAY LIST 03:07PH billiards team upbeat about gold medal chances in SEA Games05:25PH boxing team determined to deliver gold medals for PH00:45Onyok Velasco see bright future for PH boxing in Olympics00:50Trending Articles01:35Panelo suggests discounted SEA Games tickets for students02:49World-class track facilities installed at NCC for SEA Games03:04Filipino athletes share their expectations for 2019 SEA Games02:25PH women’s volleyball team motivated to deliver in front of hometown crowd01:27Filipino athletes get grand send-off ahead of SEA Games Also comprising the team are four-time champion Amaya Paz-Cojuangco, who delivered the lone silver two years ago, and two-time Olympian Mark Javier.Completing the lineup are Rogelio Miguel Tremedal, Joseph Benjamin Vicencio, Niron Brylle dela Cruz, Florante Matan and Earl Benjamin Yap in the men’s team.The women’s squad is also composed of Pia Elizabeth Angela Bidaure, Nicole Marie Tagle, Jennifer Chan, Kim Concepcion, Kareel Meer Hongitan, Mbigail Tindugan and Mary Queen Ybanez.Two gold medals will be at stake in compound events Wednesday at Synthetic Turf Field, KL Sports City. ADVERTISEMENT Catriona Gray spends Thanksgiving by preparing meals for people with illnesses LOOK: Venues for 2019 SEA Games Man sworn in as lawyer by judge who sentenced him to prison as a teen 20 years ago “It will be just for one term,” said Moreno, who, along with 15 other members of the Philippine archery team, sees action starting Wednesday.He admitted feeling the pressure to perform after the country went home without a gold in Singapore two years ago.FEATURED STORIESSPORTSWATCH: Drones light up sky in final leg of SEA Games torch runSPORTSSEA Games: Philippines picks up 1st win in men’s water poloSPORTSMalditas save PH from shutout“For me personally I will just try to remember what I practice and hope for the best,” he said.The team had five international trips, including a week-long training camp in San Diego before competing in the World Cup in Salt Lake City in the United States. Flags of SEA Games countries raised at Athletes Village Don’t miss out on the latest news and information. center_img Read Next MOST READ Brace for potentially devastating typhoon approaching PH – NDRRMC SEA Games in Calabarzon safe, secure – Solcom chief LATEST STORIES Sepak takraw targeting 2 golds UPLB exempted from SEA Games class suspension View commentslast_img read more

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BSP will corner UPA on Land Acquisition Act: Mayawati

first_imgBSP president and Uttar Pradesh Chief Minister Mayawati on Sunday said that her party would corner the UPA government in Parliament on the issue of Land Acquisition Act.”The Congress ruled the country for over 50 years and has not done anything for the welfare of the people, specially dalits. It even failed to review the archaic Land Acquisition Act and the BSP will raise this issue vociferously in the coming monsoon session of Parliament,” Mayawati said at a convention of BSP workers from Madhya Pradesh, Chhattisgarh, Rajasthan and Orissa.Taking a dig at Congress for backing the farmers’ protest at Bhatta Parsaul against the land acquisition, she said the Congress did not do anything all these years to replace the old Land Acquisition Act, though farmers were opposed to it.The BSP supremo also said that Congress had failed to do anything on bringing back black money in foreign banks. If this money was reclaimed, it would end the poverty of 50 per cent of the people living below poverty line, she said.She blamed Congress’ economic policies for the backwardness of the people and alleged that its policies were intended to benefit the industrialists close to the party.Mayawati said that her own party was run with donations only from common people, and therefore the BSP government’s policies only aimed at the welfare of the common people.BSP had a fair chance of becoming an alternative to the Congress and BJP in Madhya Pradesh, Chhattisgarh, Rajasthan and Orissa, she asserted.advertisementShe also said that BSP would organise nationwide protests against the hike in the petrol prices.- With PTI inputsFor more news on India, click here.For more news on Business, click here.For more news on Movies, click here.For more news on Sports, click here.last_img read more

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Sony launches Xperia E3 and E3 Dual at 11,990

first_imgAfter an unveiling at IFA 2014, Sony has officially released its budget feature phone into the Indian market. The Sony Xperia E3 and its sibling the Xperia E3 Dual will be available for purchase today onwards. The smartphones are priced at Rs 11,990 for the single SIM variant and 12,990 for the dual-SIM version. Sony has released the 4.5 inch screen devices with a feature set in competition with the Android One and Xiaomi’s RedMi 1S devices. The Xperia E3 devices come packing a capacitive panel set at a tame 854 x 480 pixels, with a 1.2GHz Snapdragon 400, quad-core processor underneath along with 1GB RAM and the Adreno 305 GPU for considerable gaming performance. These handsets run Android 4.4 KitKat and sport 4GB internal storage with options to expand it to 32GB through microSD card. Both phones measure in at 8.5 mm thick and weigh in at 144 grams. What is generally touted as Sony’s forte -imaging, has been a bit disappointing in the E3. the primary camera is a decent 5 megapixel shooter with Full HD video recording. The 0.3 megapixel front camera though is a pittance in comparison to the generally 2.0 megapixels found in this price bracket and even much cheaper rivals, nowadays.The E3 and E3 Dual both come with a 2330mAh battery and Sony’s STAMINA mode for enhanced battery performance. Connectivity features standards like 3G HSPA+, Bluetooth 4.0 and aGPS.Competition in this price segment has grown exponentially in recent months and the Android One range of smartphones  launched by Google is also strict competition with pretty much the same feature set at a  considerably cheaper price. advertisementSony’s Xperia E3 and E3 Dual seem like a rushed attempt that comes in a bit short and a tad too late along the line.last_img read more

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(RPTNG AFTER CORRECTION IN INTRO)

first_imgGovt-backed athletes should set up academies, centres: Goel New Delhi, Sep 12 (PTI) Touched by Paralympian Mariyappan Thangavelus gesture to donate Rs 30 lakh from his prize money to his school, Sports Minister Vijay Goel today said that all athletes backed by the government should strive to set up academies or centres of their own to inspire the youth. Mariyappan, who scripted history at Rio Paralympics after winning a gold medal in high jump, has donated Rs 30 lakh from his 2 crore prize money towards his government school in Tamil Nadu. “Its a great thing, a great step taken by Mariyappan, this will inspire others. I think all athletes who are helped by the government can try to set up academies or sports centres of their own. This will definitely inspire one and all,” Goel said after the launch of online portal of SAI-AIFF Overseas Scouting Project. Mariyappan hails from Periyavadagampatti, a village located 50 km from Salem in the western part of the state. The Sports Ministry last week said it has started a “thorough review” of Indias dismal outing at the Rio Olympics and is also seeking feedbacks and suggestions from the athletes who competed in the quadrennial extravaganza. “It has just started. It will take time and as you know I have sought feedbacks and suggestions from the athletes. I have written to and mailed all the athletes about this. I am personally going to meet them and talk to them in this regard,” Goel said. India finished with a disappointing tally of two medals, through PV Sindhus silver in badminton and Sakhsi Maliks bronze in wrestling, at the two-week sporting gala last month. This has prompted the concerned stakeholders to look into the past and analyse the performances to ensure a better future. PTI AH SSC AHadvertisementlast_img read more

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DISCOVER THE 10th AUSTRALIAN MASTERS GAMES

first_imgSeriousSport and SeriousFun…The 10th Australian Masters Games. You see, while I’m living in Canberra now, I’m a South Australian at heart, having lived there for most of my life. So when told the Games were heading `home’ to Adelaide, I jumped at the change to chat with Games General Manager Lachlan Clark about the event and how it’s coming together. The Games are being held from October 7-16 this year, with preparations well underway for an expected participant base of well over 10,000 people. The last Australian Masters Games were held in Canberra and the Nations Capital certainly put on a show, I was involved in helping out with the running of the Touch competition and enjoyed the event and the atmosphere of the competition. Already though, Lachlan can see the 10th Games being even bigger and better. “Participant numbers are very good at this early stage. We are ahead of the 9th Australian Masters Games at the same stage and they ended up with 10,300 participants. We would really like to see the 10th Australian Masters Games the biggest Australian Masters Games ever. “Preparations are going extremely well. The Ceremonies program is complete, the planning for the Games centre is well underway and we have had some great assistance from the South Australian Government.” With over 10,000 participants logistics is always complicated and one great initiative that this year’s Games will see is that all accredited participants, accompanying people and volunteers will be able to travel free of charge on the existing Adelaide Metro public transportation network for the ten days of the Games. Competitors for the Australian Masters Games are largely from Australia itself, with about two thirds of the participants expected to travel from interstate for the event. However, Clark and his team have already had many international entrants from Guam, Hong Kong, New Zealand, India, and the USA In Canberra in 2003, the Games had 52 sports with this number jumping to a record 64 sports for the Adelaide event. “The increase in the number of sports means that there is indeed something for everyone. It is also an opportunity to have a go at multiple sports. If you have registered a team to play touch but you also want to bring your bike and have a bash at Mountain Biking, you can simply pay the sport fee associated with Mountain Biking and have a go,” said Lachlan. “The leading sport at the moment is Golf, which is expected as there is a maximum of 300 participants, so if you are interested in playing Golf at the Masters Games, get in early. The other big sports at the moment are Athletics, Basketball and Softball.” But what about Touch? Yes, I hear you asking! Well, according to Lachlan the competition is hot. “The Touch competition is looking great and the Touch venue is fantastic for the Games,” he said. “I play in a mixed comp on Thursday nights and Touch SA really has a great set up and they are very well organised. So far we have teams entered from South Australia, Victoria, Queensland and New Zealand so I think it is going to be a great competition.” It’s not just the sport that makes the Australian Masters Games an event not to be missed, but it is also the opportunity to enjoy the Games’ nightly entertainment and a chance to catch up with friends from around the country or meet new people. It’s not just about winning medals, but also about getting out and giving it a go. Lachlan also believes that for those from interstate and overseas, you can’t go past the sights of South Australia. And for a true-blue South Aussie like me, I agree with him. The 10th Australian Masters Games in Adelaide offer a fantastic opportunity to come and explore South Australia. One of the best things about visiting Adelaide is that most of the other 11 tourist regions of South Australia are no more than three hours drive away. Catch the ferry to Kangaroo Island and wander among the sea lions. Cycle through stunning valleys of vineyards on the 27km Riesling Trail in the Clare Valley. Cruise down the river on a paddle steamer in the Murraylands. Chug along on the infamous 115- year-old steam engine, the Pichi Richi, through some of Australia’s most breathtaking scenery in the Flinders. Hire a limousine and experience the best wines in the world in style as you tour the Barossa Valley. Come out for the Games and at the same time discover the secrets of South Australia. If you would like any more info on the 10th Australian Masters Games check out www.AustralianMastersGames.com If you would like any more details on the Touch competition, contact Marianne Maguire from Touch SA on mmaguire@internode.on.net or phone 08 8373 3222. By Rachel Moyle, media@austouch.com.aulast_img
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Video: Michigan Musical Theater Grads Sang An Amazing Version Of “The Victors” During A Graduation Party

first_imgMichiganmusical theatre grads gather to sing a song.Michigan The VictorsMichigan’s “The Victors” is one of the most recognizable fight songs in college football, but we’re not sure if it’s ever been performed quite like this. This video emerged over the weekend, and it features 22 Michigan musical theatre grads doing their own rendition of “The Victors” at a graduation party. The footage was posted by Scott Orr yesterday. This version of the song is very different, and pretty impressive.  Listen to this! What happens when 22 talented UMich musical theatre grads sing their version of the University of Michigan fight song at their graduation party. Awesome!Posted by Scott Orr on Sunday, May 3, 2015last_img

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Researchers explore why and how Mediterranean diet may mitigate cardiovascular risk

first_img Source:https://www.brighamandwomens.org/ Reviewed by Kate Anderton, B.Sc. (Editor)Dec 7 2018A new study by investigators from Brigham and Women’s Hospital, Harvard Medical School, and the Harvard T.H. Chan School of Public Health offers insights from a cohort study of women in the U.S. who reported consuming a Mediterranean-type diet. Researchers found a 25 percent reduction in the risk of cardiovascular disease among study participants who consumed a diet rich in plants and olive oil and low in meats and sweets. The team also explored why and how a Mediterranean diet might mitigate risk of heart disease and stroke by examining a panel of 40 biomarkers, representing new and established biological contributors to heart disease. The team’s results are published in JAMA Network Open.”Our study has a strong public health message that modest changes in known cardiovascular disease risk factors, particularly those relating to inflammation, glucose metabolism and insulin resistance, contribute to the long-term benefit of a Mediterranean diet on cardiovascular disease risk. This understanding may have important downstream consequences for the primary prevention of cardiovascular disease,” said lead author Shafqat Ahmad, PhD, a research fellow at the Brigham and at the Harvard Chan School.Randomized trials in Mediterranean countries and observational studies have previously linked a Mediterranean diet to reductions in cardiovascular disease, but the underlying mechanisms have been unclear. The current research draws on data from more than 25,000 female health professionals who participated in the Women’s Health Study. Participants completed food intake questionnaires about diet, provided blood samples for measuring the biomarkers, and were followed for up to 12 years. The primary outcomes analyzed in the study were incidences of cardiovascular disease, defined as first events of heart attack, stroke, coronary arterial revascularization and cardiovascular death.Related StoriesSofrito cooking technique releases healthy nutrientsScientists examine hormonal links between diet and obesityDiet and nutrition influence microbiome in colonic mucosaThe team categorized study participants as having a low, middle or upper Mediterranean diet intake. They found that 428 (4.2 percent) of the women in the low group experienced a cardiovascular event compared to 356 (3.8 percent) in the middle group and 246 (3.8 percent) in the upper group, representing a relative risk reduction of 23 percent and 28 percent respectively, a benefit that is similar in magnitude to statins or other preventive medicationsThe team saw changes in signals of inflammation (accounting for 29 percent of the cardiovascular disease risk reduction), glucose metabolism and insulin resistance (27.9 percent), and body max index (27.3 percent). The team also found connections to blood pressure, various forms of cholesterol, branch-chain amino acids and other biomarkers, but found that these accounted for less of the association between Mediterranean diet and risk reduction.”While prior studies have shown benefit for the Mediterranean diet on reducing cardiovascular events and improving cardiovascular risk factors, it has been a black box regarding the extent to which improvements in known and novel risk factors contribute to these effects,” said corresponding author Samia Mora, MD, MHS, a cardiovascular medicine specialist at the Brigham and Harvard Medical School. “In this large study, we found that modest differences in biomarkers contributed in a multi-factorial way to this cardiovascular benefit that was seen over the long term.”last_img read more

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Researchers document specific characteristics of storefront tobacco advertisements

first_imgReviewed by James Ives, M.Psych. (Editor)Apr 25 2019In response to U.S. restrictions on where tobacco companies are allowed to advertise their products, the industry now dedicates nearly all of its $9 billion advertising budget to activities occurring in retail settings. A new study by researchers at Columbia University Mailman School of Public Health fills an important gap by documenting specific characteristics of storefront tobacco advertisements in the context of today’s diverse tobacco product landscape. Findings are published online in the journal Preventive Medicine.”The mechanisms through which tobacco advertising in retail settings influence product use are not well understood, particularly for non-cigarette products,” said Daniel Giovenco, PhD, assistant professor of Sociomedical Sciences. “The aim of our study was to describe how ad features, such as flavor promotion, size, and placement, vary across product categories, and how this may contribute to consumer behavior.”The researchers analyzed nearly 1,000 photos of storefront tobacco ads taken from a representative sample of 796 licensed tobacco retailers in New York City between July and October 2017. Cigarettes were the most commonly advertised product (40 percent of ads), followed by electronic nicotine delivery systems (ENDS, 28 percent), cigars (27 percent), and smokeless tobacco (5 percent). Nearly a quarter of all ads were for Newport cigarettes, a brand commonly used by African American smokers. The promotion of menthol or flavored product styles was documented in 60 percent of cigarette and smokeless tobacco ads, versus 26 and 30 percent of cigar and ENDS ads, respectively.Related StoriesPublic health concerns as MPs’ connection to organization part-funded by tobacco industry revealedCo-use of cannabis and tobacco associated with worse functioning, problematic behaviorsStudies show no evidence of fall in cigarette consumption due to WHO’s FCTCAlthough cigarette ads generally took up a larger amount of window space compared to other product types, cigar and ENDS ads were more commonly placed directly on the door of entry, potentially making them more noticeable to consumers. Tobacco ads were frequently displayed directly next to other tobacco ads and other “vice” products. For example, a quarter of cigar and cigarette ads were adjacent to ads for sugary drinks and lottery tickets.Importantly, advertising features did not always align with local or federal tobacco control policies. For example, 10 percent of cigarette ads did not contain a warning label, despite a federal mandate. Similarly, a third of cigar ads promoted a flavored product, even though flavored cigars are now prohibited from being sold in New York City. Advertising policy violations may be attributed to retailers who leave “older” ads displayed for long periods of time, irrespective of the evolving policy landscape.”By documenting and monitoring specific point-of-sale advertising strategies, compliance with tobacco control policies, and assessing their impact on tobacco use behaviors, we are building the necessary evidence base needed to inform sound policymaking,” said Giovenco. “It is important that local, state, and federal governments forcefully move forward in regulating one of the ‘last frontiers’ and most effective forms of tobacco marketing. “Source: https://www.mailman.columbia.edu/public-health-now/news/study-finds-differences-storefront-tobacco-advertising-product-typelast_img read more

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Biomassproduced electricity in the US possible but itll cost

If the U.S. wants to start using wood pellets to produce energy, either the government or power customers will have to pay an extra cost, a new University of Georgia study has found. This document is subject to copyright. Apart from any fair dealing for the purpose of private study or research, no part may be reproduced without the written permission. The content is provided for information purposes only. Biomass-produced electricity in the US possible, though expensive Explore further Right now, “it’s just not economically feasible to use wood pellets in energy production,” said Bin Mei, associate professor of forest resource finance and economics in UGA’s Warnell School of Forestry and Natural Resources.Wood pellets are used heavily in European power plants because of a mandate to cut fossil fuel emissions, Mei said, but that energy production is heavily supported by government subsidies.Should U.S. energy providers switch to a “co-firing” method-where a power plant burns both coal and wood pellets, switching between the two-they’d pass on the costs to not only convert to co-firing plants, but also to buy the pricier wood pellets. If a government subsidy won’t pay for the extra costs, Mei said, then consumers would have to pick up the tab.Mei and co-author Michael Wetzstein with Purdue University recently published their findings in Energy Economics.In the U.S., power plants have traditionally used coal to produce electricity, but coal emits high levels of carbon dioxide and other pollutants. The European Union has taken the lead on worldwide efforts to switch to burning biomass instead of coal, while the U.S.’s Clean Power Plan aims to lower the country’s carbon dioxide emissions from power plants by 32 percent from the recorded 2005 levels within the next 25 years. Right now, the U.S. is exporting about 4.8 million tons of wood pellets to Europe to help them meet their power demands.Although European companies have converted, U.S. electricity producers can’t simply abandon their coal-fired plants, Mei said. The plants are designed to last decades and are built at significant costs. But they can be modified to burn some biomass, and wood pellets are one of the easiest things to switch to, he said.Mei and Wetzstein looked at the fluctuating coal and wood pellet prices and incorporated price uncertainty and conversion cost into decision making.In other words, a decline in wood pellet price may not immediately trigger the adoption of mixed fuel of a power plant because of the conversion cost. This is known as the “inertia effect” in financial economics, but government interventions can change this situation.They found that producing power with a mixture of coal and wood pellets simply isn’t a “commercially viable option in most cases,” Mei said. Based on historical price data, “the price pairs fall into the switch-to-coal region, meaning that it is not economical to co-fire wood pellets with coal because the mixed fuel cost increases with the share of wood pellets.”Mei said they found that there would be times when converting plants to co-fire with wood pellets would be triggered, and all of the scenarios would require either a government subsidy or an extra fee charged to power customers.The government would have to pay $8 billion to prompt power plants to convert to using both coal and wood pellets, and $2.7 billion to retain current co-firing power plants, Mei said.”These numbers are roughly comparable to the subsidies and tax credits for solar and wind energy on a per unit basis,” Mei said. “Therefore, renewable energy policies should give equal priorities to wood pellets co-firing as to solar and wind energy in the U.S.” Provided by University of Georgia Credit: CC0 Public Domain Citation: Biomass-produced electricity in the US possible, but it’ll cost (2018, April 25) retrieved 18 July 2019 from https://phys.org/news/2018-04-biomass-produced-electricity-itll.html read more

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