Your feedback: on defence, energy and climate

NB: Just before I hand you over to Andrew today, there is something I think you’ll want to see. We have arranged a special webinar event this Wednesday at 7pm, where tech expert Sam Volkering will reveal four ways you could earn a 10-X gain from the stockmarket. And the best part is, it’s completely free to watch. So long as you reserve your place in time. Click here to get your name down now.

Many thanks,

Harry Hamburg
Content manager, Exponential Investor

Our postbag’s been pretty full recently. Here are some of the best letters we’ve received.

We edit letters for length, flow and standard English.

BAE Systems

From: Mr B
Subject: Ethical Investing

Investing in Murder. There is no other way to see it. Some call it defence – but the military actions of the western countries are, almost without exception, offence.

I believe that the choices we make with our money could have a profound impact on the world we live in.

Invest in Tesla or VW?
Invest in Solar and Wind or Petroleum?
Invest in Biomedical or Defence?
Make a choice about the planet you would like to live on.

Wealth is great – but it is worthless if our children cannot inherit a world worth living in.

Mr B might suggest BAE Systems is a corporate accessory to murder; I couldn’t possibly comment. However, it’s worth noting that sales to countries outside “the West” are generally more controversial than those to our near-shore allies. In general, I do believe that investing can do good – and that backing b******s is often a short-sighted investment strategy. I certainly don’t shy away from exploring ethical issues in Exponential Investor – and I don’t believe they can be separated from the pure financial aspects of investing.

Geoengineering

From: Peter
Subject: Geoengineering

Your recent articles on geoengineering describe only one type of solar radiation management – the dispersal of aerosol particles in the stratosphere. You should also mention marine cloud brightening (MCB). This involves the pumping of finely-divided seawater particles through a nozzle into the lower parts of stratus clouds, brightening them. 

Quite right, Peter – but sulphuric acid geoengineering is better studied than the various alternatives.

From: Ken
Subject: SAGA aircraft

How many such aircraft would be needed to obtain the effect you are talking about? What is the payload in weight and it terms of chemical composition? How much CO2 will these huge engines pump back into the atmosphere?

We have balloons that reach the altitude that you are talking about quite easily. If this approach is part of the answer, then why not use existing technology?

Payload would be a few million tonnes per year of sulphuric acid, requiring only a modest fleet. The CO2 emissions would be pretty trivial, compared to general air traffic – let alone the wider economy. This technique has been well studied by various authors – and balloons don’t perform favourably. Converted executive or military jets have more promise, but they’re likely to be much more expensive, and polluting, than purpose-designed aircraft.

Paris is burning

From: Andrew
Subject: Carbon Capture

I don’t understand why there isn’t more enthusiasm for planting forests. 

The notion of collecting carbon dioxide and storing it for eternity seems to be the essence of folly. Where and how could it be stored?

The suggestion that misting the upper atmosphere with sulphuric acid – which would ultimately descend as acid rain – has the potential to be a huge own goal. 

Geoengineering would actually require very little sulphuric acid – around 10% of the current human emissions. Most of the effect on ocean acidification is actually indirect; colder oceans absorb more CO2. Forest restoration is a possibility, but much of the Earth’s original forests are now farms. Storing CO2 in rocks is permanent, if done correctly. The CO2 reacts with the rock, so it can effectively never get out.

Go East

From: John
Subject: Energy Policy

I am disgusted by the energy policy in the UK. There are many small things that could be done which would start to make a difference: why is it not a condition of planning that all new houses must have at least half their roof made of solar tiles? Why are heat pumps not compulsory in all new developments? It might add a bit to the cost of a new house – but with experience, and economies of scale, the cost would come down. The houses would be considerably more eco-friendly, forever.

There’s a lot of sense in what you’re saying, John – but an interesting alternative to this micro-management is a carbon tax. This idea is currently getting a lot of attention among US Republicans. Correcting market failures is a fascinating subject, and one we may return to.

From: Nick

In response to your article, I agree that the UK has messed this one up completely – but May had to go ahead with Hinkley for political reasons.

I believe that solar has limited prospects in the UK – given the disparity of power produced in summer/winter. Wind, however, will become our primary source of power – once we’re able to store it.

The UK has a comparative advantage in wind, which it doesn’t have in solar. This doesn’t mean that solar can’t play a part in our energy mix, however. Without a Europe-wide supergrid, we’re going to require a mix of generation sources.

We don’t take letters on letters – but here’s my address, anyway andrew@southbankresearch.com.

Best,

Andrew Lockley
Exponential Investor

Category: Technology

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