The Most Important Graph in the World

Tuesday, April 7, 2009

The phases of all boondoggle projects

Seen here, aimed at Portland's decision to use public money to build sports stadia, but certainly applicable to many other projects, such as the "Willamette River Crossing" (3rd bridge fantasy):
There are two phases to any project:
Phase 1 - It's too early to tell.
Phase 2 - It's too late to stop.

Should be part of every school year

Starting at Kindergarten and continuing through post-grad.

Probably too little, too late, but it's immoral to give up without trying

I just sent an email to my state legislators letting them know we can't afford to compromise on establishing a legal limit on global warming pollution this year. Would you take a minute to do the same thing?

Just point your web browser to http://www.onwardoregon.org/capnocompromise09 and fill out the form!

By the way, here's where your health care money goes


(click to enlarge)

Vital:

Nice column in the Statesman-Journal noting Finland's success in education, which shows the bankruptcy of the standardized test model that the USA has been inflicting since the corporations seized the opportunity presented by "The Nation at Risk" hysteria during the Reagan years. Quantcast

Visitors to Finland in search of its educational secrets discover relaxed, cooperative classrooms, strong early emphasis on math, science and languages — physics and chemistry in middle school, and proficiency in Finnish, English and Swedish by the seventh grade — and high-quality, creative teaching.

Americans notice particularly the absence of some favorite [US] strategies: early childhood education (Finnish kids start school at age 7), restrictive rules (no tardy bells, no school uniforms), continuous standardized testing (high school students don't even experience standardized tests until they take exit exams at age 18.)

Salem--like everywhere in the US--desperately needs to rethink our educational approach. Instead, we apply the same approach to our collapsing educational institutions that we do to dealing with sprawl, thinking that, if we just do it more, this time we'll get a different result.

Nice timing for this column to get us thinking about education: Coming up at Salem Cinema, starting Friday, April 10.

Memo to Salem's Downtown Redevelopment folks

You're doing it wrong. The only groceries available near all Salem's new condos and apartments are beer and cigarettes. As a public health matter, Salem needs to focus on bringing a greengrocer downtown. We subsidize parking for cars like crazy, building them entire multi-story buildings. Why shouldn't we take some of that money and spend it on improving public health instead?

VICTORIA — Want to lose weight? Move closer to a grocery store.

A new study from the University of British Columbia shows people who live within a kilometre of a grocery store are half as likely to be overweight, compared to those living in neighbourhoods without grocery stores.

The study shows that old-style urban planning that mixes retail with residential zones gets people out of their cars, onto the sidewalks, and helps them keep their weight down.

And if one grocery store is good, two or more is even better, the report released Monday showed.

Researchers found that every additional store within a kilometre translated into an 11 per cent reduction in the likelihood of being overweight.

"People have to access food," said study author Lawrence Frank. "It's a marker for other commercial uses, as well, so it's not just grocery stores that matter."

About 620 people over the age of 15 participated in the study: 576 from the Lower Mainland and 131 from Vancouver Island.

The study measured physical activity and body mass, along with proximity to retail and commercial buildings.

The research found that people walked more often when they lived in neighbourhoods with good street lighting, continuous sidewalks, and a variety of shops, services, schools, parks and workplaces within walking distance.

The study also linked body mass to urban design, showing that people who live in suburb-style neighbourhoods that force them to drive to the store makes them more likely to be overweight.

"None of this is new," Frank said. "What is new is we have a better understanding of how much (urban-development patterns) are affecting us, and the results support more of the traditional approach to building communities."

The study found that people whose neighbourhoods includes stores that front directly onto a sidewalk — rather than those where a parking lot separates the store from the sidewalk — were half as likely to be overweight as those living in neighbourhoods without sidewalk-front stores.

"People don't like walking through a sea of cars," Frank said. "It's not a friendly space."

Book on building community from the ground up

THE GREAT NEIGHBORHOOD BOOK: A Do-It-Yourself Guide to Placemaking

by Jay Walljasper and the Project for Public Places
2007; 192 pages; 8.5" x 7.5"; paperback; ISBN: 0-86571-581-5

Catherine Nicosia, Community Bookshelf Manager (Fellowship for Intentional Communities):

The willful destruction of public life in modern times has been so stupendous that real effort must be made to restore it. This includes especially the actual places where it might thrive. It is not unusual to find streets, roads, parks, and other common spaces where there is no one out and about at all, except in automobiles. This is true in both both urban and rural areas.

The Great Neighborhood Book offers realistic ways to change this situation. It is a how-to guide for individuals, groups and local communities on how to improve the quality of life through building shared bonds. It is also full of ideas for creating great places to hang out, fostering economic vitality by creating local marketplaces, supporting social networks and much more. Drawing heavily upon real-life examples in both large and small communities that made a measurable positive difference, the authors blend practicality and inspiration.

I was particularly impressed in reading this book by how many of the examples and suggestions could be incorporated into thinking about the design of new places as well the remaking of existing ones. This makes The Great Neighborhood Book a valuable resource for those crafting new common spaces, wherever they might be. Highly recommended for everyone wanting to live in great places that are created from the community up, not top down.

Another good argument for creating a public utility district for Salem

From Citizens Utility Board of Oregon:
Executive Compensation and Corporate Bailouts have been in the national news recently, but they are also a local issue. Many folks may have seen Steve Duin's column in the Oregonian concerning recent controversy over PGE's Executive Compensation. What many readers may not be aware of is that PGE hopes to be bailed out for its lost profits during the current recession. And this bail out is going to come from ratepayers, in the form of a surcharge on our electric bills, not the government.

Like nearly all businesses in the country, PGE is seeing its retail sales fall. Unlike nearly all other businesses, however, PGE may get to make up its lost profits during this recession by tacking them onto our future electric bills. But that is not all - because of the design of the bail out, PGE will actually get to recover more than its lost profits.

This means that when a small business lays off an employee, PGE sees its profits increase. A house that is vacant and on the market for months also increases PGE's profits.

These are the results of a little-noticed PUC decision in January that granted PGE a decoupling mechanism. The theory behind decoupling is to "decouple" the link between a utility's profits and the volume of electricity the utility sells. According to the theory, by eliminating this link, utilities should be more interested in investing in energy efficiency. Because energy efficiency is a cheaper resource than investing in new power plants and reduces electric bills, decoupling should lead to lower costs for customers.

In theory, decoupling sounds good, and the amount of lost profits due to energy efficiency improvements is relatively small. But because decoupling looks at the lost profits due to a reduction in load, it has a much bigger impact during a recession. During a recession, as economic activity falls, demand for electricity falls at a rate that is greater than can be caused by even the most aggressive energy efficiency programs. In the last recession, PGE's one-year reduction in load was more than 8 times greater than we would expect from energy efficiency programs.

The PUC established this new mechanism for PGE's residential and commercial customers with a two-year trial period. The PUC also ruled that any surcharge to make up for lost profits should be no more than 2% per year. But if the lost profits exceed this cap, that excess amount will simply roll over and be charged to customers in the following year. PGE calls this practice a "circuit breaker"; we call it an installment loan.

The current recession is proving to be much worse than the last recession. Unemployment in Oregon reached 11.9% in February, more than double where it was a few months ago. This is much worse than the 8.8% peak unemployment during the last recession in 2002-03. And few economists believe that we have reached bottom yet.

With the decoupling roll-over provision in place, PGE customers are going to be paying for this mechanism for several years. If small commercial customers see load decreases similar to the 2002-03 recession, there will be a surcharge for 3 years. But we know this recession is worse. Based on the strength of this recession, the surcharge could last 5 or more years.

The problem with this decoupling mechanism isn't limited to the number of years that we will be paying for it; we will also be overpaying PGE for their lost profits under this mechanism. When a customer uses less electricity than PGE forecasted, PGE gets to sell that saved electricity into the wholesale market. So, the financial loss to PGE can never be more than the difference between the wholesale electricity price (which PGE gets from selling the saved power) and the retail rate (which PGE would not get because the customer did not use the forecasted amount of electricity).

In recent years, the difference between the price of wholesale electricity and PGE's retail rates has been has been about 3 cents per kilowatt hour (kWh). This means that PGE loses 3 cents for every kWh that its customers do not purchase. PGE's decoupling mechanism, however, pays them 4.6 cents/kWh. Next time you drive by a vacant house or vacant storefront, consider this: PGE is losing about 3 cents for every kWh that would have been used in that house or store, but customers will have to reimburse the company 4.6 cents (plus interest) for each kWh.

Decoupling is not a terrible idea. CUB supported decoupling experiments for electric utilities in the 1990s, but found that decoupling mechanisms had no positive effect on a utility's level of support for energy efficiency programs. Utility investment in energy efficiency actually declined while the utilities were decoupled.

More recently, decoupling proved to be successful for natural gas utilities in Oregon during the 1990s. CUB learned from these experiments, and when natural gas utilities wanted decoupling, we demanded that the decoupling mechanism be directly tied to additional energy efficiency investments. Our proposal was the basis for decoupling mechanism for NW Natural and Cascade Natural Gas. If these utilities cut their energy efficiency investment, they will automatically lose their decoupling mechanisms. In addition, it should be noted that a recession doesn't have the same impact on a natural gas utility that it has on an electric utility.

Last week, CUB made a filing with the PUC asking them to suspend PGE's decoupling mechanism until the current recession is over. We are asking the PUC to fix the mechanism so customers aren't required to overpay PGE for reductions in load when it resumes after the recession. Finally, if the Commission is unwilling to suspend decoupling until the end of the recession, we are asking them to make the 2% rate cap, a hard cap with no roll-over. Under this scenario, PGE would still make about $35 million off this mechanism, without having to commit a dime to additional energy efficiency. (That's bad policy, but better than allowing them to make $50 or $70 or $100 million off of decoupling with no energy efficiency investments).

Finally, we note that decoupling was implemented for an electric utility just as the economy was heading into a recession once before. It was in Maine in the early 1990s. The Maine PUC implemented decoupling for Central Maine Power, and within two years customers owed the utility $52 million. Because of this experience, decoupling is no longer seen as a useful tool in Maine.

Is Oregon going to make the same mistake as Maine, or are we wise enough to correct this mistake before ratepayers spend millions to bail out PGE.
Decoupling -- removing the utility incentive to sell more power as the way to make more money -- is fine, but the devil is in the details. Allowing the utility to reap extra profit from the drop in power sales due to the Great Recession is like giving the Rooster extra chow for the brilliant sunrise -- it's rewarding someone for something they had nothing to do with bringing about.

The bottom line is that Oregon suffers greatly compared to its neighbor to the north, where public power districts -- citizen-owned nonprofit power companies -- are much more prevalent. PGE's latest shenanigans (a sweet multimillion dollar sendoff for a 57-year old CEO while plenty of people in Oregon are facing utility shutoff notices) only points out again that we should never expect anything better from a private power company until we take them over and run them for everyone's benefit, rather than just the benefit of the stockholders.

Public power really took off in the Great Depression -- the current return of those hard times would be an excellent time to finish the job and get rid of private power entirely. We are going to be faced with some very difficult challenges in the next few years; getting a grip on climate is going to require a lot more than most people realize. The only way we're going to get through these times successfully is if the power companies can forget the profits of stockholders and worry about the well-being of Oregon, rather than paying lip service to the well-being of Oregon and actually only caring about the profits of stockholders.