It’s been a pretty good year so far for mortgage rates, which topped out at around 8% last year.
The 30-year fixed is now priced about one full percentage point below its year ago levels, per Freddie Mac.
And when you consider the high of 7.79% seen in October 2023, is now over 150 basis points lower.
But the recent mortgage rate rally may still have some gas in the tank, especially with how disjointed the mortgage market got in recent years.
Simply getting spreads back to normal could result in another 50 basis points (.50%) or more of relief for mortgage rates going forward.
Forget the Fed, Focus on Spreads
There are a couple of reasons mortgage rates have improved over the past 11 months or so.
For one, 10-year treasury yields have drifted lower thanks to a cooler economy, which is a boost for bonds.
When demand for bonds increases, their price goes up and their yield (interest rate) goes down.
Long-term mortgage rates follow the direction of the 10-year yield because they have similar maturities (mortgages are often prepaid in a decade).
So if you want to track mortgage rates, the 10-year yield is a good place to start.
Anyway, inflation has cooled significantly in recent months thanks to monetary tightening from the Fed.
They raised rates 11 times since early 2022, which seemed to finally do the trick.
This pushed the 10-year yield down from nearly 5% in late October to about 3.65% today. That alone could explain a good chunk of the mortgage rate improvement seen since then.
But there has also been some narrowing of the “spread,” which is the premium MBS investors demand for the risk associated with a home loan vs. a government bond.
Remember, mortgages can fall into default or be prepaid at any time, whereas government bonds are a sure thing.
So consumers pay a premium for a mortgage relative to what that bond might be trading at. Typically, this spread is around 170 basis points above the 10-year yield.
In other words, if the 10-year is 4%, a 30-year fixed might be offered at around 5.75%. Lately, mortgage rate spreads have widened due to increased volatility and uncertainty.
In fact, the spread between the 10-year and 30-year fixed nearly doubled from its longer-term norm, meaning homeowners were stuck with a rate 3%+ higher.
For example, when the 10-year was around 5%, a 30-year fixed was priced around 8%.
Normalizing Spreads Could Drop Rates Another 60 Basis Points
New commentary from J.P. Morgan Economic Research argues that “primary mortgage rates could fall by as much as 60 bps over the next year” thanks to spread normalization alone.
And even more than that if the market prices in more Fed rate cuts.
They note that the primary/secondary spread — what a homeowner pays vs. the secondary mortgage rate (what mortgage-backed securities trade for on the secondary market) remains wide.
Head of Agency MBS Research at J.P. Morgan Nick Maciunas said if the yield curve re-steepens and volatility falls, mortgage rates could ease another 20 bps (0.20%).
In addition, if prepayment risk and duration adjustment fall back in line with their norms, spreads could compress another 20 to 30 bps.
Taken together, Maciunas says mortgage rates could improve another 60 basis points (0.60%).
If we consider the 30-year fixed was hovering around 6.35% when that research was released, the 30-year might fall to 5.75%.
But wait, there’s more. Aside from the mortgage market simply rebalancing itself, additional Fed rate cuts (due to a continued economic slowdown) could push rates even lower.
How Much Will the Fed Actually Cut Over the Next Year?
Remember, the Fed doesn’t set mortgage rates, but it does take cues from economic data.
At last glance, the CME FedWatch tool has the fed funds rate hitting a range of 2.75% to 3.00% by September 2025.
That’s 250 bps below current levels, of which some is “priced in” and some is not. There’s still a chance the Fed doesn’t cut that much.
However, if it becomes more apparent that rates are in fact too high and going to drop to those levels, the 10-year yield should continue to fall.
When we combine a lower 10-year yield with tighter spreads, we could see a 30-year fixed in the low 5s or even high 4s next year.
After all, if the 10-year yield slips to around 3% and the spreads return closer to their norm, if even a bit higher, you start to see a 30-year fixed dip below 5%.
Those who pay discount points at those levels might have the chance to go even lower, perhaps mid-to-low 4s and maybe, just maybe, something in the high 3s depending on loan scenario.
Just note this is all hypothetical and subject to change at any given time. Similar to the ride up for mortgage rates, there will be hiccups and unexpected twists and turns along the way.
And remember that lower mortgage rates don’t necessarily imply another housing boom, assuming higher unemployment offsets purchasing power and/or increases supply.
Before creating this site, I worked as an account executive for a wholesale mortgage lender in Los Angeles. My hands-on experience in the early 2000s inspired me to begin writing about mortgages 18 years ago to help prospective (and existing) home buyers better navigate the home loan process. Follow me on Twitter for hot takes.
Two new AI systems, ALOHA Unleashed and DemoStart, help robots learn to perform complex tasks that require dexterous movement
People perform many tasks on a daily basis, like tying shoelaces or tightening a screw. But for robots, learning these highly-dexterous tasks is incredibly difficult to get right. To make robots more useful in people’s lives, they need to get better at making contact with physical objects in dynamic environments.
Today, we introduce two new papers featuring our latest artificial intelligence (AI) advances in robot dexterity research: ALOHA Unleashed which helps robots learn to perform complex and novel two-armed manipulation tasks; and DemoStart which uses simulations to improve real-world performance on a multi-fingered robotic hand.
By helping robots learn from human demonstrations and translate images to action, these systems are paving the way for robots that can perform a wide variety of helpful tasks.
Improving imitation learning with two robotic arms
Until now, most advanced AI robots have only been able to pick up and place objects using a single arm. In our new paper, we present ALOHA Unleashed, which achieves a high level of dexterity in bi-arm manipulation. With this new method, our robot learned to tie a shoelace, hang a shirt, repair another robot, insert a gear and even clean a kitchen.
Example of a bi-arm robot straightening shoe laces and tying them into a bow.
Example of a bi-arm robot laying out a polo shirt on a table, putting it on a clothes hanger and then hanging it on a rack.
Example of a bi-arm robot repairing another robot.
The ALOHA Unleashed method builds on our ALOHA 2 platform that was based on the original ALOHA (a low-cost open-source hardware system for bimanual teleoperation) from Stanford University.
ALOHA 2 is significantly more dexterous than prior systems because it has two hands that can be easily teleoperated for training and data collection purposes, and it allows robots to learn how to perform new tasks with fewer demonstrations.
We’ve also improved upon the robotic hardware’s ergonomics and enhanced the learning process in our latest system. First, we collected demonstration data by remotely operating the robot’s behavior, performing difficult tasks like tying shoelaces and hanging t-shirts. Next, we applied a diffusion method, predicting robot actions from random noise, similar to how our Imagen model generates images. This helps the robot learn from the data, so it can perform the same tasks on its own.
Learning robotic behaviors from few simulated demonstrations
Controlling a dexterous, robotic hand is a complex task, which becomes even more complex with every additional finger, joint and sensor. In another new paper, we present DemoStart, which uses a reinforcement learning algorithm to help robots acquire dexterous behaviors in simulation. These learned behaviors are especially useful for complex embodiments, like multi-fingered hands.
DemoStart first learns from easy states, and over time, starts learning from more difficult states until it masters a task to the best of its ability. It requires 100x fewer simulated demonstrations to learn how to solve a task in simulation than what’s usually needed when learning from real world examples for the same purpose.
The robot achieved a success rate of over 98% on a number of different tasks in simulation, including reorienting cubes with a certain color showing, tightening a nut and bolt, and tidying up tools. In the real-world setup, it achieved a 97% success rate on cube reorientation and lifting, and 64% at a plug-socket insertion task that required high-finger coordination and precision.
Example of a robotic arm learning to successfully insert a yellow connector in simulation (left) and in a real-world setup (right).
Example of a robotic arm learning to tighten a bolt on a screw in simulation.
We developed DemoStart with MuJoCo, our open-source physics simulator. After mastering a range of tasks in simulation and using standard techniques to reduce the sim-to-real gap, like domain randomization, our approach was able to transfer nearly zero-shot to the physical world.
Robotic learning in simulation can reduce the cost and time needed to run actual, physical experiments. But it’s difficult to design these simulations, and moreover, they don’t always translate successfully back into real-world performance. By combining reinforcement learning with learning from a few demonstrations, DemoStart’s progressive learning automatically generates a curriculum that bridges the sim-to-real gap, making it easier to transfer knowledge from a simulation into a physical robot, and reducing the cost and time needed for running physical experiments.
To enable more advanced robot learning through intensive experimentation, we tested this new approach on a three-fingered robotic hand, called DEX-EE, which was developed in collaboration with Shadow Robot.
Image of the DEX-EE dexterous robotic hand, developed by Shadow Robot, in collaboration with the Google DeepMind robotics team (Credit: Shadow Robot).
The future of robot dexterity
Robotics is a unique area of AI research that shows how well our approaches work in the real world. For example, a large language model could tell you how to tighten a bolt or tie your shoes, but even if it was embodied in a robot, it wouldn’t be able to perform those tasks itself.
One day, AI robots will help people with all kinds of tasks at home, in the workplace and more. Dexterity research, including the efficient and general learning approaches we’ve described today, will help make that future possible.
We still have a long way to go before robots can grasp and handle objects with the ease and precision of people, but we’re making significant progress, and each groundbreaking innovation is another step in the right direction.
A brand new kind of design bundle has just dropped over at Design Cuts. Curated Collections are mini bundles of 4 related products for just $10, saving up to 90%. You’ll find collections of brushes, fonts, illustrations and more for Procreate, Photoshop and other art and design software. Which ones are your favourites?
Each curated collection has a specific theme, so you can be sure to find one that’s made just for you! Vintage design lover? Check out the Vintage Design Builder. Crazy about patterns? You need the Pattern Perfection Collection. Affinity user? Check out the Affinity All Stars Pack. Here are some of my picks:
Ideal for: Digital artists who love painting with Photoshop brushes.
Ideal for: Font lovers who want to add some historical charm to their typography.
Ideal for: Procreate users who want to delve into watercolour effects.
GENEVA (AP) — Soccer great Zvonimir Boban says he does not want to be president of UEFA.
It needed “a real football man,” he suggested on Thursday, in a barb at technocrats who he claimed think they are bigger than the game.
The former Croatia and AC Milan player resigned as UEFA chief of football in January in protest at president Aleksander Ceferin moving to change legal statutes that would let him stay in office longer.
Ceferin later called Boban a clown and his allies suggested the dramatic exit was positioning to one day challenge for the presidency — a claim denied in an interview with Italian daily Gazzetta dello Sport published on Thursday.
“I don’t have any interest. But a real football man in UEFA is really needed,” said Boban, who previously had a senior role at FIFA under its president Gianni Infantino. He left in 2019 to work for Milan.
“In that sense, I say it with bitterness, having fought for changes at UEFA, like FIFA before that, I was of no use for anything,” Boban said.
UEFA was approached for comment.
Ceferin and Infantino are both lawyers first elected in 2016 in fallout from turmoil at UEFA and FIFA during American and Swiss federal investigations of international soccer officials. Infantino was previously UEFA general secretary for more than six years.
“Unfortunately for years the soccer technocracy has been all the rage inside the system, depriving it of its values, which instead it should always represent and defend,” Boban told Gazzetta.
“These people think they’re more important than the game, than the players, than the coaches, than the fans and even the actual soccer institutions,” he said.
Boban joined UEFA in 2021 to be a senior advisor to Ceferin, who called his former advisor a clown in February at the UEFA Congress.
“I’m sorry about the way our relationship ended,” Boban said on Thursday, adding they had not spoken since.
Boban resigned in January citing his “total disapproval” of the legal move that would let Ceferin stay in office for 15 years through 2031.
UEFA has a 12-year term limit for its president among anti-corruption reforms passed in response to the criminal investigations that rocked international soccer bodies.
However, Ceferin steered through an amendment approved by UEFA member federations in February that would not count his first three years — technically completing the mandate of predecessor Michel Platini, who was removed from office — against his 12-year limit.
Within hours, Ceferin then pledged he will leave office in 2027 and not seek a final four-year mandate.
Some of UEFA’s 55 member federations have since said they support their Slovenian leader staying on.
___
AP Sports Writer Andrew Dampf in Rome contributed.
Which is better? Dewalt vs Bosch? 12 Volt Power Drills. WE PUT THEM TO THE TEST!
Here we test their weights, their performance and torque, and their battery life with zero resistance. On top of that, we discuss their value and price along with accessories and their warranties.
Bosch PS31-2A 12V Power Drill
Dewalt DCD710S2 12V Power Drill
Which one does better in the performance test? Which is the best dewalt drill? Which is the best milwaukee drill? Good for Home improvement?
Sat at the most southern tip of Sri Lanka is a secret surf haven, an idyllic beach-side paradise for travellers who prefer a laid back approach to holidaying. Welcome to Hiriketiya…
Save:Surf Villa Hiriketiya. Simple but completely adequate accommodation! These beach-side villas have a simple but comfortable bedroom with decent AC and a large wetroom. The location is perfect, you’ll be able to go from bed to surfboard in under 2 minutes! The villas have a garden area too, a great place to watch the macaques!
Spend: Salt House. The place to go for a laid-back stay, especially if you want to meet like-minded people and do a bit of yoga too. There is a pool, shahid lounge area, a place to grab a bite to eat and a drink too. Some rooms have a balcony or patio, but all of it is nestled on the edge of the jungle and a very short walk from the beach.
Splurge: Meda Gedara Villa. This is a short ride or drive from Hiriketiya, but it is a dream of a place to stay if travelling with a group. Highlights include a water flume through the jungle into a pool with a sea view, glorious gardens with tennis court and a yoga shala, your very own private beach, and a wonderful team on hand to make your stay as personalised and memorable as possible. It sleeps as many as 18 people, has a bunk room for the kids, and even a mini villa in the garden for anyone who feels like they need a bit more privacy.
This place is a surfers haven, so book on some morning classes and spend the afternoon honing your skills! There are plenty of tutors and schools to choose from, and many of the local accommodations will be able to arrange lessons on your behalf.
I’d also highly recommend taking a trip to the nearby nature reserve to see the elephants in their natural habitat, as well as a guided tour of the botanical gardens and turtle sanctuary a short drive away.
As goes with the cosmopolitan beachside vibe, there is plenty of yoga on the go, and you’ll nearly always find a retreat in action while you are here.
The atmosphere was incredible. It felt safe (as a female), unlike some more northern parts of the island; the locals and tourists were friendly, accommodating, and keen to share their experiences. The beachside food shacks served up the freshest food and smoothies imaginable – even on occasion the host would scoot off to get the ingredients as an order was placed. It was at a place on the beach that I hands down had the best squid of my life. And the passion fruit martinis… it felt strange to have a cocktail that feels healthy, made with fruit fresh from the tree!
As wonderful as it feels, the illusion of paradise was the thing I found most difficult here. Sri Lanka is going through some very difficult social and economic times, and the people here are struggling. The jarring difference between being immersed in a privileged bubble vs meeting local people struggling to survive is something I advise people to be aware of before they come here. Some say that Sri Lanka as a destination is “India lite”, nonetheless you will encounter the same issues, but not in the same magnitude.
Pack for rain, sun, mosquitos, swimming, hiking… honestly, check out this packing list for what to take, you won’t regret it! The Sri Lanka Ultimate Packing Guide.
Get your visa sorted well in advance and check your vaccination status.
Sri Lanka has a closed currency, so get your travel money there and only use ATMs at a bank or major hotels.
Brush up on etiquette,it is a buddhist nation so certain things are highly taboo! Check out more here: Sri Lanka Travel Advice.
Don’t flash your valuables. People here are in poverty, not only is it disrespectful, but could also attract opportunistic crime.
If you are a female traveller, take extra care and avoid being out after dark on your own.
Get travel insurance! It amazes me how many people don’t take travel insurance seriously. Even something minor such as losing a passport can be costly and time consuming, and who wants that while on holiday?
Sudanese Christians outside All Saints Cathedral in Khartoum, Sudan, on March 29, 2008.(Photo: Religion News Service/Fredrick Nzwili)
Despite the Sudanese civil war that’s devastated the region, the All Saints Anglican Cathedral in Khartoum is still standing. But its compound is now a graveyard, with a vandalized altar and missing pews, which have been chopped by soldiers for firewood, according to Archbishop Ezekiel Kondo.
At the start of the war in April 2023, the cathedral was the seat of Kondo, the 67-year-old primate of the Episcopal (Anglican) Church of Sudan. On April 15, 2023, fighters from the paramilitary Rapid Support Forces quickly seized the compound, flipping it into an operation base while Kondo and his family remained inside.
“It happened very abruptly. Nobody expected it,” Kondo recalled, speaking to RNS from Port Sudan, a city on the Red Sea where he has sought refuge since June of last year. “It was Saturday when we were in the office preparing for the Sunday service, after the first week of Easter Sunday. We heard a very heavy sound of gunfire, only to get out and find heavy smoke billowing nearby.”
The war for control over northeast Africa is being fought between two rival factions of the military government of Sudan: the Sudanese Armed Forces, under Abdel Fattah al-Burhan, and the paramilitary Rapid Support Forces and its allies, under the Janjaweed leader Hemedti. The factions turned on each other after jointly wresting control of the civilian government.
Restrictions on media and aid access have made precise statistics on the scale of devastation hard to obtain. The United Nations estimates that 750,000 people are at threat of starvation, while U.S. envoy Tom Perriello has estimated that the war has killed as many as 150,000 people. Other estimates are much lower, at about 15,000 confirmed deaths. The war has also displaced more than 10 million people, making it the largest global displacement crisis, and left an additional 25 million in urgent need of humanitarian aid, over half of the country’s population.
For some, this is the second civil war they’ve fled in recent years. In South Sudan, nearly 400,000 people were killed in clashes from 2013 to 2018.
The cathedral is close to the army headquarters and the airport, where the full-scale war broke out during Ramadan last year. With the armed confrontation intensifying, the Rapid Support Forces had rushed its soldiers to surround the church compound, hoping the place of worship would not be bombed and would guarantee them some protection.
“They were there at the gate and we were unable to do anything. We were unable to get out,” Kondo said. “All the families that were there gathered in the church hall. Other people also ran and joined us. We spent three nights there.”
After three days in the cathedral’s basement without water or food, Kondo and other leaders decided to leave. After interrogations at gunpoint, the soldiers finally allowed them to go. The church leaders and their families then walked for an hour and a half to find transport to take them to the south of Khartoum with less violence. Kondo’s family remained there for two months, only to move again after the bombardment became more intense and closer.
“One of the shells fell near where we were,” Kondo said. He then decided to move with his family to Port Sudan. “It was very difficult, but we thank God. He has been our protector.”
In Port Sudan, Kondo continues to call for peace as he ministers in the diocese there, while staying in touch with Anglicans still in Khartoum.
“There are pastors who are still with the people there and I tell them to be strong not be afraid,” Kondo said.
Out of 33 Anglican churches in the greater Khartoum area, only five are no longer functioning.
The archbishop is angry that many people have died in what he calls a needless and senseless war.
“I would like to urge parachurch organizations to join in the effort to send relief food to the people of Sudan. If food is not given, many people are going to die,” Kondo said.
Less than 3% of Sudan’s population is Christian, while 91% is Muslim, according to 2020 Pew Research Center data. So far, the fighting armies have attacked or destroyed 165 churches, according to Open Doors.
The war has also emptied most of the senior church leaders and missionary organizations from Khartoum.
Kondo wants the two fighting factions to end the war and agree to give peace to Sudan’s people, but for that to happen, the countries supplying weapons to the two parties must stop, he said.
The international community has been attempting to bring the fighting factions to the negotiating table. Last month’s U.S.-led peace talks in Switzerland ended without a deal, just like two previous ones in Saudi Arabia and Bahrain.
As the war continues, many Sudanese are dying from diseases, hunger and natural disasters such as floods. The U.N. has warned that the violence could turn into or be recognized as a genocide, with reports of civilians being targeted based on their ethnicity. But Kondo said he still hopes in God.
“Yes, we are in trouble, the country is in trouble, but we know God is our refuge,” he said.
Solar panels on the roof of our house in Austin, September 13, 2024.
Hyping solar energy is one of America’s most renewable resources. For instance, in 1978, Ralph Nader declared that “everything will be solar in 30 years.” In 1979, President Jimmy Carter declared the US needed to capture more energy from the sun because of “inevitable shortages of fossil fuels.”
In 2011, in the New York Times, Paul Krugman claimed we are “on the cusp of an energy transformation driven by the rapidly falling cost of solar power.” In 2015, presidential candidate Hillary Clinton pledged that if elected president, she would oversee the installation of 500 million solar panels.
In 2021, the Department of Energy released a study that claimed solar “has the potential to power 40% of the nation’s electricity by 2035.” That’s a mighty big claim. Last year, solar accounted for about 5% of US electricity production. Furthermore, solar only provided about 2.2 exajoules of primary energy to the US economy out of 94.2 EJ used. The DOE also claimed solar could reach 45% of US electricity production by 2050. (That same year, President Joe Biden declared that climate change poses “an existential threat to our lives.”)
The solar hype continued last month in the pages of the New York Times with an article by David Wallace-Wells headlined, “What Will We Do With Our Free Power?” The nut graf of Wallace-Wells’ article appeared near the end when he claimed, “the exploding scale and disappearing cost of solar do mean that the energy game will now be played according to some pretty different ground rules.”
Before going further, a disclosure is in order. I understand the economics of solar. About eight years ago, we had 8.2 kilowatts of solar capacity installed on the roof of our house. Why? We got three different subsidies to do so. We now produce about 12 megawatt-hours of electricity per year and have cut our annual electricity bill in half. Further, that was the second solar system we installed on our home here in Austin. We got fat subsidies for the first system, too.
For the record, I’m opposed to all energy subsidies unless I’m the one getting them. But I digress.
Back to Wallace-Wells. He is correct in reporting that solar capacity is growing. Last year in the US, solar capacity grew nearly four times faster than wind capacity. Solar grew by 24.8 gigawatts, while wind capacity grew by 6.3 GW. Further, due to its higher power density, solar will continue to grow faster, both here in the US and around the world. Wallace-Wells goes on to repeat the same shopworn arguments we’ve been hearing for nearly 50 years: solar is getting cheaper, capacity is growing, sunshine is free, and therefore, it really is different this time. He writes:
Because the sun can be simply counted on to rise every day, you don’t need to pay in any ongoing way for a commodity input, like oil or gas, to keep the system humming — only to set it up initially to manage and endure the novel challenges of drawing reliable energy from the giant fireball 94 million miles away. And over the next decade, even that all-in cost is expected to fall in half again. Negative electricity prices, in which consumers are actually paid to consume electricity, are already a recurring feature in the world’s mature markets.
He continued:
Though it seems like a line from starry-eyed science fiction, the dream of electricity “too cheap to meter” arose first in the giddy early days of nuclear power, the phrase coined by the midcentury atomic advocate Lewis Strauss…And it is easy to get carried away with the gauzy utopian possibilities of energy both functionally infinite and effectively free.
But there ain’t nothing free about solar or any other form of energy, and there never will be. For as long as humans have been on this planet, our most fundamental quest hasn’t changed. We seek more energy so we can convert it into more useful power — computing power, motive power, cooking power, cooling power — so that we can do more productive work. That’s what we humans are about. Yes, we may have dubbed our species homo sapiens, but we are, in reality, homo faber. And that making and doing requires ever-increasing amounts of power.
The latest figures from LevelTen Energy show that solar prices aren’t falling, they are rising.
Wallace-Wells can cheer until my PV panels are destroyed by the next hail storm, but he might consider resting on his pom poms for a moment to report on what’s happening in the marketplace. As seen above, solar prices aren’t falling. They are rising. In July, consulting firm LevelTen Energy reported that prices for solar power purchase agreements rose 3% during the second quarter and that solar prices have nearly doubled since 2020. LevelTen said the price surge reflects “the development challenges that are collectively placing upward pressure on solar PPA prices across North American markets.” It continued, saying the challenges include:
Long interconnection queues and permitting difficulties. But in recent months, additional uncertainties have been introduced through the expansion of tariffs on Chinese PV components as well as a new investigation into allegations of duty circumvention and dumping practices from PV component producers in Southwest Asia. These events illustrate a trade law environment that is growing increasingly challenging for solar developers in the United States.
Wallace-Wells barely mentions China in his article. But trade laws are casting big clouds over the solar sector. Three years ago, the Biden Administration issued sanctions against multiple Chinese companies due to their connections with Uyghur slave labor.
In May, in “Shanghaied,” I published the graphic above. Remarkably, six different agencies of the federal government are saying the Chinese government is carrying out genocide in Xinjiang, the province that produces some 45% of the world’s solar-grade polysilicon. Given that reality, it’s not surprising that solar cheerleaders like Wallace-Wells, Bill McKibben, and others don’t want to talk about their favorite industry’s near-total reliance on Chinese supply chains.
Wallace-Wells also ignores the vast disparity in solar deployment around the world. He claims, “by some ways of tabulating, solar power is already cheaper than all other new sources of electricity for something like 95 percent of the world.” And what are those ways of tabulating? He doesn’t say. That begs the question: if solar is so cheap, why isn’t Africa using more solar? As seen in the graphic above, the unfortunate answer is that solar is still mainly used in wealthy places. That helps explain why California, a state with 39 million people, is generating twice as much electricity from solar as Africa, even though the African continent has roughly 36 times more people than the Golden State.
By now, it should be clear that Wallace-Wells cares more about the narrative about solar than marketplace realities. Speaking of the market, as seen above, the growth in natural gas-fired generation has swamped the increase in solar since 2015.
As seen above, that growth continued last year when gas-fired generation grew by 115 terawatt-hours while solar increased by 21 TWh. Put another way, gas-fired generation grew five times faster than solar last year.
A final point, and it’s one that I’ve made before. California has added more solar than any other state in the country. And as it has added more solar, electricity prices in California have increased at an alarming rate. As I pointed out last month in “Kamala America?” in absolute and percentage terms, California’s electricity prices have surged more than any other state in the country since 2008 when then-governor Arnold Schwarzenegger issued a mandate for renewable energy.
In March, my favorite Energy Bad Boys, Isaac Orr and Mitch Rolling, wrote an excellent piece here on Substack called “How to Destroy the Myth of Cheap Wind and Solar.” And destroy, they did. Orr and Rolling asked the critical question: if wind and solar are so cheap, why do they make electricity expensive? Their answer was straightforward:
We aren’t building a new electric grid from scratch, so we should be comparing the cost of new wind and solar with the cost of existing power plants that these intermittent generators would hope to replace. The truth is that we already have reliable, depreciated assets that produce electricity at low cost, and they could’ve kept doing so for decades. This means that building new wind and solar adds to the cost of providing electricity to the grid. If wind and solar were truly lower cost than other forms of energy, we would expect states like California and Minnesota, which have high penetrations of wind and solar, to see falling electricity costs. Instead, electricity prices in these states have increased much faster than the national average.
Graphic from Energy Bad Boys article: “How to Destroy the Myth of Cheap Wind and Solar.”
Orr and Rolling concluded:
The intermittency of wind and solar imposes unique expenses on the electric grid that require an evaluation of the entire electric system in order to derive meaningful cost estimates from these generators. This is difficult to do, which is why most people don’t do it.
The “unique expenses” that Orr and Rolling mention are becoming more apparent by the day. Consider California, which has more installed solar capacity than any other state, about 49.4 GW. But the state’s all-out solar push has created a regressive tax on the poor and middle class. Last month, the Public Advocates Office at the California Public Utility Commission reported that solar subsidies in the state will cost ratepayers who don’t have rooftop solar panels about $8.5 billion this year.
Furthermore, those costs are rising. As seen in the graphic above, pulled from the PAO’s report, the cost shift related to net energy metering, which subsidizes rooftop solar, has more than doubled since 2021. Here’s the key section from the report:
The subsidies, paid for by non-rooftop solar customers, are a contributing factor to high electricity rates. This cost burden — commonly referred to as a cost shift — to non-rooftop solar customers of Pacific Gas and Electric, Southern California Edison, and San Diego Gas & Electric has risen from $3.4 billion annually in 2021 to $8.5 billion annually by the end of 2024, and it will continue to grow in coming years.
To put this in perspective, remember that California has the dubious distinction of having the highest poverty rate in the country. And yet, in its headlong pursuit of solar energy in the name of climate change, it is imposing a regressive energy tax on the people who can least afford it. Ashley Brown, the executive director of the Harvard Electricity Policy Group, rightly calls the proliferation of rooftop solar systems and the returns they provide to lucky people like me, “a wealth transfer from less affluent ratepayers to more affluent ones.” It is, he says, “Robin Hood in reverse.”
Alas, none of these facts about solar energy made it into Wallace-Wells’ article. But they are facts.
What I’m reading
As I explained last month in “Where Are The Pro-Nuclear Democrats?” the Democratic Party can’t be taken seriously when it comes to nuclear energy. Ted Nordhaus of the Breakthrough Institute provided more proof of that in his September 4 piece about Matthew Marzano, who the Democrats have nominated for a spot on the Nuclear Regulatory Commission. Nordhaus called him the “most unqualified candidate” ever put forward for that agency. As I reported during the Democratic National Convention, top Democrats have been mouthing the right words about nuclear energy, but the party didn’t mention it in its platform. Joe Biden has never, to my knowledge, endorsed nuclear, and I will bet $100 here and now that Kamala Harris will not utter the words “nuclear energy” between now and November 5.
Yesterday, Nordhaus followed up with a review of Marzano’s testimony at his recent confirmation hearing. Nordhaus said that it was clear that if Marzano is seated at the NRC, “he will be a defender of the status quo, not an advocate for regulatory modernization.”
I’ve said many times that the US nuclear sector has enormous potential. Dozens of paper reactor designs are hoping to get licensed by the NRC, and numerous startups are filled with bright and ambitious people who want to see their reactors pump juice into the grid. The obstacles, though, are obvious: regulation, capital, and fuel. Until the Democrats get serious about the regulation part and, thus, about reforming the NRC, which includes nominating the best people for the commission, the domestic nuclear industry will continue to struggle.
What time is it on the Moon? NASA is trying to figure that out. Together with other global partners, the US space agency is launching a new effort to try to establish a coordinated time for the Moon. The aim is to create a Coordinated Lunar Time (LTC) so everyone can be on the same page. Who knows, if people ever live on the Moon–and that is actually a real plan of the new Artemis program–this could be important to know when the new Call of Duty comes out.
NASA’s Space Communication and Navigation program is taking point alongside other members of the US government and “international standards organizations.” How will they come up with a time?
NASA said it will be determined by a “weighted average of atomic clocks on the Moon.” This is similar to how Earth’s Coordinate Universal Time (UTC) is calculated. However for Coordinated Lunar Time, scientists have some additional issues to overcome.
“Exactly where at the Moon is still to be determined, since current analysis indicates that atomic clocks placed at the Moon’s surface will appear to ‘tick’ faster by microseconds per day,” NASA said. “A microsecond is one millionth of a second. NASA and its partners are currently researching which mathematical models will be best for establishing a lunar time.”
NASA says this is a critical undertaking in part because the space organization aims to send humans back to the Moon in its Artemis program and to establish a “sustained presence” or and around the Moon.
“The approach to time systems will also be scalable for Mars and other celestial bodies throughout our solar system, enabling long-duration exploration,” NASA said.
There is also a need for a time standard because the commercial space industry is growing quickly, and accurate and coordinated time-keeping is important for safe and sustainable journeys, NASA said.
In terms of the commercial space industry, just last week, SpaceX took astronauts higher into space than anyone has gone in 50 years and conducted the first commercial spacewalk. Billionaire Jared Isaacman paid his way and completed the spacewalk alongside astronaut Sarah Gillis. Both successfully splashed down off Florida on Sunday. In less-than-ideal space travel news, the astronauts who went to the International Space Station in June remain stuck there due to issues with Boeing’s Starliner capsule.
