Comments on: Why an Energy Crunch Could Lead to Booming Profits in “Solid Electricity” http://www.dailyreckoning.com.au/why-an-energy-crunch-could-lead-to-booming-profits-in-solid-electricity/2008/04/24/ An independent perspective on the Australian and global investment markets Sat, 21 Nov 2009 17:27:32 -0600 http://wordpress.org/?v=2.8 hourly 1 By: liz zaleski http://www.dailyreckoning.com.au/why-an-energy-crunch-could-lead-to-booming-profits-in-solid-electricity/2008/04/24/comment-page-1/#comment-25511 liz zaleski Wed, 04 Jun 2008 00:02:52 +0000 http://www.dailyreckoning.com.au/?p=2526#comment-25511 Why isn't Alcoa diverting some of its capital to finehone solar power, so that bauxite can be converted in the sunny north of Australia. Reading all of your comments, it's as if only coal and oil are potential sources of power. Why isn't Alcoa diverting some of its capital to finehone solar power, so that bauxite can be converted in the sunny north of Australia. Reading all of your comments, it's as if only coal and oil are potential sources of power.

]]> By: Tony http://www.dailyreckoning.com.au/why-an-energy-crunch-could-lead-to-booming-profits-in-solid-electricity/2008/04/24/comment-page-1/#comment-24000 Tony Sat, 24 May 2008 02:11:06 +0000 http://www.dailyreckoning.com.au/?p=2526#comment-24000 BAU THE BIG TIP BAU THE BIG TIP

]]> By: Mike http://www.dailyreckoning.com.au/why-an-energy-crunch-could-lead-to-booming-profits-in-solid-electricity/2008/04/24/comment-page-1/#comment-20071 Mike Thu, 24 Apr 2008 23:24:46 +0000 http://www.dailyreckoning.com.au/?p=2526#comment-20071 I've seen a few of these articles about the middle east being the next big thing in aluminium. Sure the middle east is oil rich and they can use oil to generate electricity but that doesn't make it any cheaper to produce aluminium than china building more power stations using oil to generate electricity (ignoring shipping costs for the moment). In economics 101 this would be all about opportunity cost wouldn't it? The middle east countries can sell oil on the open market, to the likes of china, and profit from that, or divert some of that oil to power stations to produce aluminium. Can they make more from burning the oil and producing aluminium than selling the oil on the spot market? The only difference between the emirates building an oil powered electricity plant and china building one is the ongoing shipping costs for the oil (and timely and guaranteed supply for the middle east). The capex would probably be cheaper in china. Of course from the point of view of a bauxite producer I guess it doesn't matter whether the big plants of the future are in the middle east or china. I've seen a few of these articles about the middle east being the next big thing in aluminium. Sure the middle east is oil rich and they can use oil to generate electricity but that doesn't make it any cheaper to produce aluminium than china building more power stations using oil to generate electricity (ignoring shipping costs for the moment). In economics 101 this would be all about opportunity cost wouldn't it? The middle east countries can sell oil on the open market, to the likes of china, and profit from that, or divert some of that oil to power stations to produce aluminium. Can they make more from burning the oil and producing aluminium than selling the oil on the spot market?

The only difference between the emirates building an oil powered electricity plant and china building one is the ongoing shipping costs for the oil (and timely and guaranteed supply for the middle east). The capex would probably be cheaper in china.

Of course from the point of view of a bauxite producer I guess it doesn't matter whether the big plants of the future are in the middle east or china.

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