Excess Energy Demand

Ecology is becoming one of my research interest lately. We see TV program on global warming very often. I am trying to understand this phenomena from Economics perspective.

Looking at Demand & Supply curve, energy consumption demand is increasing especially in third world countries. Excess demand pressures price to increase. Fuel price has doubled since I came to the States 1.5 years ago, almost quadrupled in a decade. It does not seem to stop... Excess demand to energy eloquently explains two very troubling factors today; 1) energy price increase and 2) global warming.

Next question should be, what does US policy do right now to fight these global threats? — Nothing. Dollar should appreciate its value if US economy is to fight against inflation just like Europeans are doing. Kyoto Protocol has not been signed by US, meaning we don’t care so much about global environment. Hmm… Of course, there are more complicated factors involve so I do not draw any conclusion here. But facts clearly point to a direction that we should do something about this for sure.

There are new concepts like CO2 Emission Right derivatives; i.e. to monetarize carbon emission right and sell to other party that has obligation to reduce the emission. Scientists argue that this concept does not “reduce” CO2. But let us look at it this way; if third world country don’t care about CO2 emission and keep on boosting demand for energy in least environment friendly way, the world will be busted for sure.

Monday is my day for research and should like to continue this topic.