The coming shortage of helium and how government policy is creating it. | Hacker News Reader

The coming shortage of helium and how government policy is creating it.

scientificamerican.com

28 pointsstretchwithme23 comments

There's a mandate that sales cover the costs associated with the helium reserves, so they've lowered the price to increase the sales in the short run without regard to the long term strategic value of having a huge chunk of a limited world supply.

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That is a nasty linkbait-y retitling. As far as the Helium Privatisation Act goes, the government was being accused of "waste" in 1996 when it was sitting on a vast stockpile of helium (from prior military uses.) It decided to sell it off over a controlled period so as to not depress the price excessively and put private suppliers out of business. They gave themselves the deadline of 2015 to have it all sold, presumabley so as to reduce the government debt in a reasonable time frame. [1]

Now it seems that helium is much more valuable but the price is depressed because this stockpile has to be sold by 2015. So something that made sense at the time now doesn't, and a new act is needed to say they can take longer to sell the helium. Government fail? Only if they don't change the policy.

Oh, and the HPA almost unanimously approved by Congress (411-10, with 12 not voting.) [2]

EDIT TO ADD: I am grumpy about this because titles like that generally go with the articles along the lines of "nasty government interfering with the market." But in this case, the report wants the government to be the government, to act strategically, not to sell at the market price but above it, and generally to interfere. The 1996 Act stopped the government doing its job in order to cut perceived waste and debt. The act should never have passed congress in the first place, or at least not in such a fixed way, but it did because it fitted people's stupid, prejudiced narrative that the government is too "big".

[1] http://www.helium.com/items/874929-understanding-the-helium-...

[2] http://projects.washingtonpost.com/congress/104/house/2/vote...

>So something that made sense at the time now doesn't, and a new act is needed to say they can take longer to sell the helium.

This sort of thing shouldn't require an act of congress/parliament.

A general rule of not selling >$Y of goods that are above X% of the yearly market without treasury approval would seem more sensible.

The post office can't even stop delivering mail on Saturday without an act of Congress. The wheels of bureaucracy continue to turn despite whatever signals the market sends.

One of the reasons the government fails is because it never wants to change a policy once set, and doing that when failure become obvious to all often takes decades.

This is one reason, don't know the applicability here: http://en.wikipedia.org/wiki/Public_choice_theory

BTW, that lopsided a vote is all to often correlated with bad legislation.

I remember California's alleged market reforms where it was illegal to make long term contracts. When it blew up in our faces back around the turn of the century, I remember former governor Pete Wilson saying he knew there were problems but he figured they'd be fixed after they passed. It didn't happen until after the disastrous contrived shortage thanks to the power it gave companies like Enron.

Ram it through, get it on the resume and leave the mess to those that follow.

Is helium being used not only because it is inert but for its other properties as well? I mean if an application just needs an inert gas could it use argon instead?

It plays a big role in cryogenics, too. Helium is the standard way of cooling (non-HTC) superconductors down to operating temperature.

Right on. MRIs need liquid helium to cool their superconducting magnet, and they need to be topped up every so often, to accommodate boil-off. It's getting pricier to do so, increasing the cost of an already expensive apparatus.

Helium is still essential for the operation of low temperature superconductors. Also, MRI experiments with hyperpolarized Helium-3 are an active area of research with potential applications for diagnostic medicine (visualization of the lungs).

OK so how does one profit from this? I have tried to find a way to buy Helium futures before, but haven't been able to. Does anyone know where/how this is possible?

Why would you think that it's a better idea to buy helium now than it was to buy lithium before the recent discovery of large lithium deposits in Afghanistan?

I don't follow... More lithium was found, whereas helium is going to become scarce. What do the two have in common?

Well, we could always find another large deposit of helium in some undiscovered salt mine. Unlikely, but there are still parts of the earth largely unsurveyed. So maybe. After that, maybe in 50 years we'll start mining helium3 from the moon, or producing it ourselves in a fusion reactor.

From what I understand, He-3 would actually be consumed in plausible energy-netting fusion reactions, which is the reason for the whole lunar mining speculation. I think prices would need to be pretty steep before lunar mining makes economic sense.

The reaction you're thinking of is: Deuterium + He3 -> proton + He4 + energy. So the reaction also yields helium. Helium is a very common product from fusion reactions. We can produce it now, just not in very large quantities. But cryogenics have money, and a need for helium, meaning they might be willing to pay for it being produced in such a way in the future.

Given the amount of energy that is produced for every atom of helium you are getting this is an unlikely path to adding to the global helium reserves. We would be able to power a small country with the energy that would be produced in the course of getting enough helium to fill a small blimp.

Before more lithium was found, it was thought that lithium was going to become scarce.

The more fundamental point is what do you think you know that isn't known by the people, including speculators, whose livelihood depends on helium supplies? Do you think the information you've just received isn't reflected in the price of helium futures?

Dammit, what shall I fill my blimp with now? Hot air?

Hydrogen!

just don't coat it with an aluminium based paint

I think a magnesium based paint would work better.

I was just wondering earlier today how long world helium reserves could last. For airships a 90% reduction in carbon emissions won't matter if helium becomes the economic bottleneck. Sort of depressing how soon we seem to be reaching a point where depletion of earth resources is inevitable.

Hydrogen would be interesting if we could make it safe enough. It could double as a fuel source for the ships, too.

Unless we find a way to make profitable fusion.

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