What Kyoto Bubble?

I'm really starting to like Iain Murray 'cause he makes my life here on this blog so much easier!

A lot of people are getting very rich as a result of policy changes, but there is substantial risk that we are seeing an energy frenzy develop. Economic historians might well look back on the first decade of this century as the days of the "Kyoto Bubble."

Grab the tinfoil. Make hat.

According to his estimates, CO2 trading will be a $40 billion annual industry by the end of this decade.

So that means that in 4 years time, the entire volume of carbon trading will roughly equal last year's profits of just one of the Competitive Enterprise Institute's donors*.

Unfortunately, energy consumers are not quite as happy.

Yeah, unless they're also XOM shareholders. Forgive me for not grabbing the shotgun and hunkering down in the basement just yet, but if anyone's getting rich, it's probably not...

Another Kyoto area where money is flooding in with the expectation of quick profits is renewable energy technology.

Money is flooding:

Money is not flooding:


Iain then goes on to tell us that government should get out of the whole thing and let the market do its work. But the government is already out of that business. Consider the $148 million for solar and $44 million of wind energy initiative he mentions. Out of a $2.77 trillion proposed FY2007 budget, $23.6 billion goes to energy. So roughly 0.8% of the energy budget will go to solar and wind. Big whoop.

* Iain works for the Competitive Enterprise Institute which is partially funded by ExxonMobil.