Nationalized Power

With the new frontier of technology approaching as oil reserves run lower and lower, its clear something will replace fossil fuels as our main source of energy. Biomass obtained from algae being one notable example ( At a fundamental level, it is going to be a challenge in the United States—or any developed country—to replace an energy infrastructure already laden with complex grid systems and huge refineries.

If successful, innovations such as this would provide cheap energy for everyone. All of this begs the question - who is going to pay for it? The logical answer is those who are going to benefit the most. In the hands of a private company, this industry could keep fuel prices constant (or charge whatever they want) so it would be preferable to the masses if the government took the reigns. I am curious what Dopers think would be long term and short term ramifications of nationalized power.
Wouldn’t it be a hoot if America began to sell excess energy to formerly oil rich sheiks?

Because nationalization has worked so well before.

Doesn’t mean it can’t work. I’d prefer an efficient, honest government to be getting the profits from vital industries, than greed-inspired individuals and companies.

You seem to be talking about two different things here. Power (as in the power grid), and, I presume, oil (used mainly in the US as a transport fuel). Nationalizing power (whether this is a good idea or bad…bad IMHO) isn’t going to do much for getting rid of oil. Or vice versa. So, my question is, do you want to talk about eliminating oil or do you want to talk about nationalizing the power grid?

I don’t believe this is clear at all, to be honest. Oil is still extremely cheap as a fuel source, and there are plenty of untapped reserves out there once the price rises enough to make them economically viable. This, of course, leaves aside the problem of GHG from CO2, but from a pure use standpoint we have plenty of oil to continue on for decades at least. I say this because you SEEM to be describing the standard Peak Oil meme that we are going to suddenly (and fairly soon) run out of oil. Or something.

I think you are talking about two things here, as I said. On the one hand you are talking about the grid and having to replace it (why?), and on the other, you are talking about refineries which have more to do with oil. Just to make sure we are on the same page, you do realize that most of our power infrastructure in the US comes from coal (and nuclear), with very little coming from oil…right?

As prices rise it, people and companies will start looking for alternatives. So, who will pay for it? We will in the form of rising prices and cross over technology.

Who will benefit most? Depends on how you define your terms and what you mean by benefit I suppose.


Disaster. Long term and short term. And worse, it’s unnecessary disaster.

It would be a hoot if we could all fly magic ponies as well…


You do realize that the majority of oil in the world is already controlled by nationalized companies, right?
Obligatory wiki link

Thing is, biomass fuel from algae farms can be produced by anyone, anywhere. So what advantage is there in creating a government monopoly over all algae farming?

As you say, it will be a challenge to replace the existing infrastructure. Which is another way of saying “replacing the infrastructure will cost a lot of money”. Which is another way of saying that this WON’T provide cheap energy for everyone, it will provide expensive energy for everyone. There’s no law of physics that says that transportation fuel has to cost less than $4.00 a gallon, just because gasoline costs less than that today.

And why do you imagine that industry could charge whatever they like for fuel? Ever hear of supply and demand? The only way industry could set whatever price they like is if there is no competition–like, say, I don’t know, if there were only one legal supplier, and that supplier was the government.

Since algae farming will neccesarily be decentralized–you need vast acreage set aside to convert sunlight, water and CO2 into hydrocarbons–there is no natural monopoly. Any farmer with the right equipment could produce transportation fuel. The way to get expensive fuel is to make it illegal for this farmer to produce fuel.

Well, it depends on what you are looking at, but generally speaking, price controls, government-run business enterprise, and the like are at best interim solutions; once a large bureaucracy is established in support of the effort in question, it tends to become moribund and self-perpetuating. The primary functions of government should be security from external threats, internal enforcement of statutes and the preservation of order, and to provide for the general welfare, i.e. support and regulate programs and efforts that are of both immediate and eventual benefit to the population as a whole, such as education, infrastructure support, and (arguably) basic health care. Government is (at least in theory) able to fund and sustain efforts that do not provide for near-term profit motive for business but are necessary for sustaining the industrial base and social cohesion. Practically speaking, even within these constraints government bureaucracies typically do a a less than competent job at financial management and minimizing waste and corruption, but the results–such as with the WPA, the Eisenhower Interstate Highway System, and the predecessor to NASA, the National Advisory Committee on Aeronautic (which provided basic research into aeronautical engineering that still serves as a basis for aircraft design today)–would not be achieved by private, profit-focused industry.

With regard to the issue brought forth by in the o.p., rather than just nationalizing energy industries (of which I find myself in agreement with Sam Stone that this would be an utter disaster for both the energy industry and the United States as a whole) it makes more sense to devote an existing or new Department of Energy Federally Funded Research and Development Center (FFRDC) to work specifically on the problem of a modernized, robust, unified national energy distribution grid and to support the development of sustainable energy sources in a larger way than we are doing now. The FFRDC would act as a research center and clearinghouse for the development of such technologies, which would then be provided or licensed to profitable energy companies to implement under only the necessary regulatory oversight without a government bureaucracy being involved in the management of such entities; essentially, a requirements-defined and verified and results-focused effort rather than taking responsibility for the administration of all that goes along with running a company, a task for which the government is empirically ill-suited.


Totally wrong thread. Deleted post.

I don’t know what the current status of PEMEX is, but years ago, it seemed to be very successful.

I vote for Stranger on a Train for energy czar. IOW, what he said.

After all, our Government has established such a stellar track record on being able to run and manage efficient enterprises…[/irony]

Should Exxon be refunded their $600MM investment?

Our government has done a pretty good job at running efficient enterprises, actually. The US Postal Service, for example.

You mean the same efficient enterprise that lost $3.8 BILLION last year?

Conveniently forgetting, of course, examples like rural electrification and universal telephone service, which ended up being “nationalized” programs because existing utilities refused to provide them, claiming they would cost too much. Hell, even today there are areas around here 30 or so miles from downtown where residents can’t get cable or broadband because the utilities say it costs too much to provide the service to those areas.

One can assume that as long as coal remains relatively cheap and accessible, energy companies will prefer it to investing billions of dollars to develop and convert to other energy sources. I happen to believe that the private sector will be unwilling, or at least hesitant, to sink the really massive amounts capital nececcesary into developing economically viable alternate sources of alternative energy in the amounts necessary for widespread use.

So who does that leave?

Yes. People who are paying attention might recall that virtually every major enterprise in the country lost money last year; AIG, for example, lost $61 billion in the third quarter alone.

Were you under the impression that private enterprises post profits every year?

I hardly think Exxon’s $600 million investment into developing algae oil is chicken feed

Utilizing AIG as an example??? How much of that loss was due to Government direction and involvement?

None. That was the fourth quarter of 2008, not the third quarter of 2009, sorry.

This is literally what American conservatives think.

People don’t use the post office as much anymore with the advent of the internet and emails. I haven’t sent a real letter in ages. However, that doesn’t change the fact that the USPS ran for over a hundred years efficiently and cheaply. Have you ever considered how incredible it is for you to be able to send any piece of paper to any place on earth by sticking a small sticker worth 43 cents on an envelope and having that paper arrive a few days later? Tell me any company that can do that cheaper.

And another thing about government control is an argument conservatives have already used, but against government intervention. Government-run enterprises don’t have to turn a profit. It’s enough to simply do the service at an affordable cost. The post office could run for the next 10 years on a loss and we’d still have it around. So could a government energy company. It’s job isn’t to turn a profit for it’s shareholders or for it’s greedy execs, it’s job is to provide power affordably. In fact, I think that government is the ONLY entity that could do that.

Seriously, do conservatives ever think about the topic before bashing any government intervention? Just looking at history can give you plenty of examples where government intervention is a good thing. Not all private industries are as wonderful as bunnies and cake, sometimes they go under. Sometimes they lie, cheat, and steal. With government, at least you can vote them out. How much control do you have over a CEO’s selection?

Some government industries are poorly run. Look at Amtrak. History of derailments, losses, and declining ridership due to inability or unwillingness to modernize. Amtrak is poorly run. But then who rides rail these days anyway?

On the other hand, the military is very well run. It employs millions, educates people, wins conflicts (when there is sane leadership), and are generally at the forefront of technological innovation.

Energy is one of those things that I think the government can do well. It affects everybody, methods of production requires lots of initial investment, and is essential enough that energy companies fighting over rates does not make things better for the average consumer. Energy is one of those industries like postal service, military, education, and health that government should run because they can absorb losses and provide equal service to everyone. People shouldn’t dismiss it simply because it’s government